Zama Project Update

The Zama field, one of the most significant oil discoveries in recent years, continues to shape the landscape of Mexico’s oil and gas future. Sylvain Petiteau, Vice President of the Zama Project, Harbour Energy, shares crucial updates on this groundbreaking development. The Zama field, which has been a first in many aspects for Mexico's oil and gas industry, is poised to become a cornerstone of the country's energy strategy.

Discovered in 2017, the Zama field featured the first wildcat exploration well drilled by a private company in Mexico, marking a major milestone following the 2015 bidding round 1.1 for Block 7. The field’s significance grew even more when it was found to extend into PEMEX’s Uchukil project. This overlap led to Mexico’s first unitization process, a collaborative effort between PEMEX, Harbour Energy, and Talos Energy. After years of negotiation, a resolution was reached in 2022, setting the stage for Zama’s development.

Located approximately 65km northeast of Dos Bocas in shallow waters of 150-200m depth, the Zama field spans about 8km by 2.5km. Along with PEMEX, the project is now developed by two partners, Talos Energy Mexico with 35% of the private part of the project, and Harbour Energy, which after the acquisition of Wintershall Dea’s share represents the other 65%.

In 2023 and 2024, the team created and submitted its Unit Development Plan. The approved UDP outlines the ambitious scope of this project, which includes the drilling of 46 wells, comprising 29 producers and 17 water injectors. These wells are expected to be developed using Tender-Assisted Drilling or Modular Platform rigs, featuring advanced technology, such as double frac-pack and artificial lifts with Electric Submersible Pumps (ESPs).

The project has an estimated 675MMb of recoverable oil from a total of 1.65Bb of oil in place, targeting a production plateau of 180Mb/d. With a pre-FEED (Front-End Engineering Design) capital investment estimate of US$4.6 billion, the Zama field represents a substantial financial commitment and a critical component of Mexico’s energy future.

Key activities for 2024 focus on setting up essential project management functions for the Zama Unit. These include establishing an independent SAP system, creating an operating trust for cash-calling processes, and consolidating the Zama Project Team. The execution of the FEED phase, awarded to the consortium of DORIS, NOMARNA, and SUMMUM in May 2024, is expected to be completed by the end of the year, delivering around 3,500 documents. Concurrently, geotechnical and geophysical surveys will be conducted to support the engineering and design phases.

A crucial aspect of the infrastructure development involves the construction of two offshore platforms, equipped with gas-liquid separators and a seawater treatment plant. This setup will facilitate the processing and injection of water for onshore energy production. Additionally, the project requires the installation of two 63.5km pipelines for transporting gas and liquids to shore, along with a power cable from the coast. These elements will connect to newly constructed, Zama-dedicated onshore processing facilities along the Dos Bocas coast, ensuring efficient resource management and delivery.

Petiteau emphasized the importance of the Integrated Project Team (IPT) formed by the Zama partners to enhance collaboration and streamline decision-making. This team, consisting of experts from Harbour Energy, Talos Energy, and PEMEX, aims to execute the activities outlined in the Unit Development Plan effectively. By capitalizing on the diverse talents and capabilities of each partner, the IPT seeks to build trust and foster a unified approach to the project’s challenges and opportunities.

Addressing the challenges of working collaboratively in this field, Petiteau comments: "From my perspective, the unification process has faced two significant challenges. The first is administrative: Despite having a written plan, implementation is always more complicated in practice. The second challenge is the initial difficulty of unification. The reservoir is split in half, making it unclear if any actor has a larger share within their area, leading to difficulties in dividing responsibilities. However, the idea is to work as Zama, not as individual companies.” This collaborative model, while not necessarily ideal for all projects, has proven beneficial for the Zama field, leveraging the unique strengths of each team member to drive the project forward.

Despite the challenges inherent in such a large-scale project, Petiteau expressed confidence in the team’s ability to deliver, highlighting its proven capacity to overcome obstacles and achieve milestones. “There will be a lot of challenges as in every project, but we proved that after previous challenges, we are here talking about the development of Zama, which shows the team’s capacity to deliver,” he stated.