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Transcript of Ndx Guzman
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Petroleum History of Mexico: How it Got to Where it is Today*
Alfredo E. Guzmn1
Search and Discovery Article #10530 (2013)**Posted October 21, 2013
*Adapted from oral presentation at AAPG 2013 International Conference & Exhibition, September 8-11, 2013**AAPG2013 Serial rights given by author. For all other rights contact author directly.
1Altamira Petroleum Company, Poza Rica, Veracruz, Mexico ([email protected] )
Abstract
Mexico has five major hydrocarbons-producing provinces: two for oil, the Southeast and the TampicoMisantla basins; and three for gas, the
Sabinas, Burgos, and Veracruz basins. It has seven other provinces with potential: California, Gulf of Cortes, Chihuahua, Sierra Madre Or iental,Sierra de Chiapas, Progreso Shelf, and the Deep Gulf of Mexico. Nevertheless, despite this natural-rich endowment, Mexico is the only country
in the world among those considered to be oil-rich that has consistently lost production and reserves in the last ten years.
Many reasons can be attributed for these results, and as this article proves, the least of them is the country`s endowment of oil and gasresources. The explanation can be found in the petroleum history of Mexico. Since 1938 the country has had only one oil company responsible
for all of its upstream activities. Even though Pemex`s performance is comparable with that of most of the majors, it is impossible that all theremnant potential of the whole country can be found and produced through only one company, no matter how large, wealthy, efficient,
technologically advanced, and successful it can be.
The understanding of the petroleum history of Mexico helps explain why the country is so unexplored and undeveloped. Significant historicalaspects/features/events have been:
the legal frame, that up to now has precluded third party-participation outside of Pemex`s in the exploration activities of Mexico;
the discovery of the supergiant onshore Mesozoic ChiapasTabasco and offshore Gulf of Campeche provinces in the 1970`s, that tookPemex to concentrate all its resources in the development of the Southeast basin;
the historically allocated Capex for E&P, that has been totally insufficient to allow a systematic exploration and development of the
country`s potential; and
the exploration activities that have focused mostly in low-risk, extension opportunities with little expenditures allocated to test rankwildcat ones.
mailto:[email protected]:[email protected]:[email protected]:[email protected] -
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The results of these policies are complete basins / provinces / plays with tremendous potential untested for all practical reasons. The history, as
it is being written today, allows for optimism as the country is being opened-up for third-party participation in the upstream, which will allowfor spectacular results.
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The Petroleum History ofMxico
How it Got to Where it is Today
Cartagena de Indias, ColombiaSept. 2013
Alfredo E. Guzmn
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The Petroleum History of Mxico
Some background
Evolution of the E&P sector Today and the future
Closing remarks
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Some background: Mxico`s oil and gas basins
Burgos
SierraMadreOriental
Sabinas
Chihuahua
Gulf of
Corts
California
Basins
Sierra deChiapas
Veracruz
Chicontepec YucatanShelf
Sureste
Macuspana
6 producing basins 6 with potential. No oil or gas yet
produced from the
deep GoMGas Oil
DeepGoM
Tampico
Misantla
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OIL
(bb)
GAS
(tcf)
Discovered
(OIP)
263.32 100% 279.47 100%
Produced 40.62 15.42% 71.59 25.61%
Reserves(3P)
30.82 11.70% 63.23 22.62%
Remnant 191.88 72.87% 144.65 51.77%
Source: National Hydrocarbon Commission
Oil and Gas historically discovered in Mxico
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Evolution of the Petroleum Industry in Mexico
Poza Rica1930
Chiapas Tabasco 1974
OffshoreCampeche 1976
North Golden Lane 1908bano Pnuco 1904
What next, Deep Water?
1940`s , 50s & 60`s
K & J fields
Tertiaryfields
The Syndrome of the Bitten Apple A. Lajous
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First Commercial Oil, April 1904
BOD
bano Pnuco Province, Tampico Basin
Production
History
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Mid K
Tert iary
BasementJr
UK
LK
0 10 20
1
seg
km
Northern Golden Lane, 1908
San Diego
de la Mar-3 At the time
this model
was notunderstood
Northern
Golden
Lane
prodn.
banoPanuco
production
Pozo Cerro Azul 4260 MBOD
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Pozo Ao BOD
Cerro Azul-4 1916 260,000
Potrero del
Llano-4
1910 115,000
San Diego
de la Mar-3
1908 80,000
Juan
Casiano-7
1910 72,000
lamo-2 1920 45,000
Juan Casiano - 7 Cerro Azul No. 4,
San Diego de la Mar- 3 (Dos Bocas)
2 KM
The San Diego de la Mar N3 well blew upand flowed through two branches creating
a crater half a km in diameter
Northern Golden Lane, 1908
P Ri Fi ld 1930
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Poza Rica Field, 1930
0
25
50
75
100
125
150
175
200
35 40 45 50 55 60 65 70 75 80 85 90 95 '00
Production history
One of the largest stratigraphic traps in the world in carbonate rocks
Poza Rica-2
discoverywell
Mxicos productiondepended on the Poza
Rica field for 30 years
Source Pemex
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The 1950 through the 1970s
Js. Arenque
Js. Tamaulipas
Js. San AndrsK. Faja de Oro North
K. Faja de Oro South
Ogarrio
Cinco Presidentes
Snchez Magallanes
Important fields were discovered in the Upper Jurasic and Middle Cretaceous
of the Tampico - Misantla Basin and the Tertiary of the Sureste Basin
UJ sedimentario Model
UK sedimentario model
Source Pemex
Th M i i th S t B i 19 0
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Cinco Presidentes
Cactus-Sitio Grande
Chac
The Mesozoic in the Sureste Basin, 1970s
Mesozoic oil
Tertiary oil
Tertiary gas
Source Pemex
In 1972 the Mesozoic carbonates underlying the Tertiary siliciclastics were
reached discovering the giant accumulations of the Chiapas -Tabasco province
and in 1976 the mega-offshore Campeche province was proven successfully.
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What the discoveries in the Mesozoic meant
Reserves increased more than 65 BBO and production
more than 2 MMBOD in less than 10 years.
BBOE 72.5
MBOD
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0
20
40
60
80
100
120
140
160
180
1938
1940
1942
1944
1946
1948
1950
1952
1954
1956
1958
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
4844 exploratory wells 1938 - 2009
Source: National Hydrocarbon Commission
The exploratory drilling reflects the investment
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18,030 wells 1960 - 2008
24,365 total1,627 producers
Source:. Dr. G. Dominguez, PEMEX publications
Development wells drilled 1960 - 2010There was also a drop in the activity in part due to the high productivity of the
Mesozoic wells
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The History After the Big Discoveries
4.79 6.33
72.5
43.5
16.0
45.8
BBOE
Source: National Hydrocarbon Commission
0
500
1000
1500
2000
2500
3000
3500
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Chiapas-Tabasco
OffshoreCampeche
N2 injectionMBOD
2010
Cantarelldecline
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What is next
The future is dependent on the approval of a proposed
Energy Reform Bill by the Mexican Congress.
Mxicos strategy is based on:
Deep water exploration (and development) Chicontepec development Unconventionals (Shale gas and (tight) oil) Optimization of mature fields
Exploration of traditional areas
Deep Waters
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0 100 200 300
kilmetros
Poza Rica
Veracruz
Reynosa
1
Cd. Carmen
CinturnSubsalino
Provincia
Salina del
Golfo
Cordilleras
Mexicanas
CinturnPlegado
Catemaco
CinturnPlegado
Perdido
Deep Waters
Half a million km, Pemex calculates a potential of 30 BBOE
Source: Pemex
Tampico
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Trion 1, best discovery in Mexican side of the the deep GoM
The Perdido Fold Belt
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Unconventionals, Shale gas and oil
Main plays:
The Eagle Ford,
continues extensively inMxico with same
characteristics it has in
South Texas
The Paleozoic ofNorthern Mxico
The Upper Jurassic ofthe Gulf Coast
The EIA considers the potential for shale gas in Mxico to be
545 TCF and the shale oil to be in the order of 13 BBO
OIL
WET
GAS
DRY
GAS
Source Pemex
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Source Pemexreef
Thrust belt
3P Reserves: 10,715 MMB (13%)27,636 MMMCF (70%)
Cum
production: 230 MMBO (0.2%)
424 BCF (1.0%)
OOIP: 81,492 MMB
OGIP: 39,756 MMMCF
Chicontepec Paleocanyon
It holds 38% of all the reserves of Mxico. Its development
requires unconventional technologies as it is mostly tight oil
Th Hi t f D G
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The History of Dry GasThe Dry Gas Basins that have been discovered in Mxico are:
Burgos (1945) and Sabinas (1976) basins
Veracruz Basin, 1953
0
20 0
40 0
60 0
80 0
100 0
120 0
140 0
160 0
19 4 5 5 0 5 5 6 0 6 5 19 7 0 7 5 8 0 8 5 19 9 0 9 5 2 0 0 0 0 5
1,400MMcfd
0
100
200
300
400
500
600
700
800
900
1000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
0
20
40
60
80
100
120
140
160
180
77 82 87 92 97 '02
Sabinas
contribution
1,000
MMcfd
Source Pemex
Th Hi t f D G
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5960616263646566676869707172737475767778798081828384858687888990919293949596979899
400
600
800
0
200
400
600
800
580
200
The History of Dry Gas
The two other Dry Gas Basins are:
Offshore Veracruz Basin, Lankahuasa field, 2002
Macuspana, Sureste Basin, 1905
Source Pemex
Th F t
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3,000MBOD
The Future
Pemex expects to bring production to 3 MMBOD, but the output will
depend on the legal reform presented to Congress.
Source Pemex
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Closing Remarks
Mexico has a very rich history regarding the search andextraction of its oil and gas.
The volumes produced compared to those found arenot what they should be.
This is in part the result of what has been called the
Bitten Apple
syndrome. But also because insufficient participation of third
parties which has limited the countrys potential.
There is a huge number of opportunities for the E&P for
oil and gas.
For these to be made real, a legal reform was presentedto the Mexican Congress.
Mxico has enough oil and gas to write another 100years of history.
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Thank you!