Tabasco Oil Production Drops as PEMEX Faces Declines

Oil production in Tabasco has experienced a significant decline, with daily output plummeting from 511Mb/d in July 2023 to 410Mb/d in November 2024. This drop represents a decrease of 84Mb/d over the past year. Tabasco, the leading state for onshore crude extraction in Mexico, continues to face challenges in meeting its production targets. The state had aimed for 2MMb/d under former President Andrés Manuel López Obrador, but it has not been able to maintain the peak production levels achieved in mid-2023.

Despite reaching a peak daily oil production of 511Mb/d in July 2023, oil production in Tabasco has been on a downward trajectory. By November 2023, it had dropped to 494Mb/d, and a year later, production further declined to 410Mb/d.

According to El Heraldo Tabasco, production has been steadily declining for the past 13 months. From 494.845Mb/d in November 2023, production fell to 487.808Mb/d by December 2023, and continued to decrease, closing at 410.362Mb/d in November 2024. This represents a net reduction of 84.446Mb/d over the period.

However, despite this decline, Tabasco remains the leading oil-producing state in Mexico, far surpassing other states like Veracruz, Chiapas, Puebla, Tamaulipas, and San Luis Potosi. Official data shows that while Tabasco produced 410Mb/d in November 2024, the combined output from the other five states only reached 180Mb/d. This highlights the continued importance of Tabasco to Mexico's oil industry.

In November 2024, PEMEX reported a total crude oil extraction of 1.407MMb/d, marking a 10.2% decrease compared to the same month in 2023. This is the largest annual decline for PEMEX in over five years, bringing the company’s crude oil production to its lowest level since May 1979. The decline also reflects a broader downward trend in Mexico's national production, which fell from 1.829MMb/d in January 2024 to 1.673MMb/d in November.

PEMEX's total liquid hydrocarbon production, which includes both crude oil and condensates, also decreased. Condensate production dropped by 8.1% to 267Mb/d , the lowest level since December 2022. Overall, total liquid hydrocarbon production fell by 9.9% to 1.673MMb/d, the lowest since July 2020. From January to November 2024, liquid hydrocarbon production declined by 5.6% to 1.772MMb/d, the lowest for the same period since 2021.

The production decrease has been attributed to several factors, including delays in payments to suppliers. As of 3Q24, PEMEX had outstanding accounts payable totaling MX$402.874 billion, causing some exploration and production service providers to pause or reduce their activities. President Claudia Sheinbaum has pledged to address these payment delays by February 2025 through partial payments.

Experts have emphasized that for mixed projects to attract private investors, it is essential to clarify how private entities can participate in these ventures. Joint risk-sharing is necessary to ensure the profitability of these projects. Without clear rules on risk-sharing and compensation, it is unlikely that PEMEX will be able to finance the projects independently through debt.