Waking the Sleeping GiantWed, 01/20/2016 - 12:34
Renaissance was awarded the three fields of Topén, Mundo Nuevo, and Malva in the third phase of Round One, which involved onshore oil fields. Kevin Smith, the company’s Vice President Business Development, believes that one of the things Mexico needs above and beyond investment capital to spend on the resource base is the introduction of new technology. “Since PEMEX has been underfunded, it has not been able to develop technology at the same pace as oil companies in the US and Canada,” he explains, adding that Renaissance has invested heavily and put a strong emphasis on its technical team, which has a solid track record in applying new technologies to liberate unconventional resources. For instance, the company was able to capture the core of the Mitchell Energy team, which cracked the code on commercializing gas from the Barnett Shale formation, resulting in the development of shale plays in the US, Canada, and elsewhere in the world. “These are the people who gave birth to a new industry,” he affirms. “As this innovative team is now involved in Renaissance, we are able to apply its knowledge and enthusiasm to tackle Mexico’s immense unconventional opportunities. In addition, we can use this expertise to apply new technologies and better develop mature fields.”
An important aspect of Renaissance is that it is a small, growing company, with an exclusive focus on Mexico, making each awarded property the highest priority. “Due to its size, PEMEX has had to leave behind some smaller and medium-sized fields that are not getting much attention for development but are highly impactful for a company like ours,” Smith shares. Renaissance plans to develop these through the application of capital and new technologies. The Vice President believes that the entrance of independent companies into Mexico’s oil and gas industry will kick-start the re-development of these fields to the great advantage of the industry.
Renaissance also has aspirations beyond conventional onshore oil fields, as the company is extremely interested in tapping into Mexico’s shale and tight rock resources. The main difficulty, according to the Vice President, will be getting around the lack of information, which comes from the fact that Mexico has not focused enough on the development of its shale and tight-rock formations. Nonetheless, he believes Mexico presents a unique opportunity. “Our initial analysis of the unconventional opportunities in Mexico is highly encouraging. Many of the shale basins in other jurisdictions, including Canada and the US, have already been identified and in development for many years, making it difficult and often prohibitively expensive to acquire an entry position. With Mexico’s unconventional industry being in its infancy, we believe there is tremendous opportunity to grow with the country in shale development,” Smith comments. Renaissance has been active in mapping and identifying shale resource trends, and the company believes that there is outstanding potential in the country.