PEMEX Renaissance, Mexican Natural Gas to Asia Debated at CMP

On the first day of the Mexican Oil Congress (CMP), industry authorities such as PEMEX CEO Octavio Romero Oropeza and Carlos Pascual, Senior Vice President, S&P Global, discussed topics to such as the designed renaissance of PEMEX and the untapped potential of exporting liquefied natural gas (LNG) to Asia.

The PEMEX CEO inaugurated the CMP by highlighting the company’s production growth over the past two years. He stated that the state-owned company had fully replenished the oil reserves, which made 60Bboe available to exploit.

During his keynote speech, Romero credited the strengthening of PEMEX to upgrades and maintenance activities at exploratory wells, which proved to be successful as it led to a production increase by 130Mb/d. He also pointed out that, unlike other companies, the NOC did not stop operations throughout the COVID-19 pandemic, an achievement to which he attributes a rise in investment by 16 percent.

Romero  said that the decision not to halt operations during this period allowed the government and PEMEX to keep a steady flow of resources, which was enhanced due to an increment in production and the increase in international crude oil prices. Accordingly, CNH reported that the NOC had produced 1.664MMb/d in 2021, which amounted to the first annual production growth since 2004.

Moreover, Romero announced that by the end of 2022, PEMEX would carry on by spudding 78 exploration wells, which should further “simplify the addition of even more oil fields,” he concluded.

Pascual said that the country should benefit significantly from surging natural gas prices in Asia and encourage exporting LNG to the region via the Pacific Ocean.

“If we have prices as high as US$40/MMBTU in Asia, then we have the ability to export gas to [that region]… this is an interesting opportunity to export LNG,” commented Pascual, adding that the for the Mexican market’s relevant Henry Hub gas price which stand at US$6/MMBTU. While this is significantly higher than recent years, ample financial room to liquefy and export remains.