Pemex Finds First Deep Water Light Crude Says Mexico's Calderon Giselle Rodriguez - MNI
go to original August 29, 2012

MEXICO CITY - Mexican President Felipe Calderon Wednesday announced the first deep water oil discovery in the Gulf of Mexico.

The well contains between 250 and 450 million oil barrels, he said. It is located in Salina Bravo, 180 kilometers (111 miles) west of Tamaulipas and 39 km (24 miles) south of the international marine border with the United States,.

"If the estimates are confirmed, this would equal to one third of the annual oil production," Calderon said, adding that the field is located in an area that could contain 4-10 billion crude barrels.

In the last six years, the government has invested over 1 trillion pesos in state oil compay Petroleos Mexicanos (Pemex), Calderon said. This has enabled the company to increase the reserve replacement rate to over 100%, compared to 23% 10 years ago.

Pemex pays more than half of its revenue in royalties and taxes, and lost 29.5 billion pesos ($2.2 billion) in the second quarter of this year, compared with a profit of 16 billion pesos in the same quarter of 2011.

The company produced 2.54 million barrels a day of crude oil from April to June.

According to a Pemex report, in January 2012, proved hydrocarbon reserves totaled 13.8 billion barrels of oil equivalent, which corresponds to an average life of 10.2 years, whereas probable reserves were of 26.2 billion.

Analysts, however, offered a word of caution since it will take time for the new find to enter production.

"One thing is making an oil discovery and other thing is being able to produce the oil and take it to the market," said George Baker, director of Houston-based Mexico Energy Intelligence.

"The critical question is how close to the existing pipelines and platforms the oil field is found; if it is far away, it may not been until the next administration that oil is actually produced," he added, noting it would take six to eight years to get the oil into production.

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