RE: Mexico news
WEE is the secret card for PEMEX... That's why they are so bullish.
WSJ article:
https://online.wsj.com/article/BT-CO-20100319-709922.html?mod=WSJ_latestheadlines
MEXICO CITY (Dow Jones)--Mexico's state-owned oil firm PetroleosMexicanos, or Pemex, said Friday its proven reserves fell 2% last yearto 13.99 billion barrels of oil equivalent at the end of 2009.
Carlos Morales Gil, Pemex's head of exploration and production, saidduring a conference call that proven oil and gas reserves represented10.2 years of production.
Pemex has reduced its annual percentage slide in proven reserves from6% in the 2005-2006 period, and 4% in the 2007-2008 period, he said.
Greater success in exploring for new sources of gas and oil allowedthe company to achieve a proven reserve replacement rate last year of77%. That means for every 100 barrels of oil equivalent that Pemexproduced, it found 77 barrels in new reserves.
At the end of 2008, Pemex's proven reserves were 14.3 billion barrelsof oil equivalent. The recuperation rate that year was 72%.
Morales said the goal for 2012 is to reach a reserve replacement rateof 100%.
Year-on-year comparisons of recovery rates can be misleading sincePemex's crude oil production--the heart of its business--has beenfalling steadily from a record 3.4 million barrels a day in 2004. Thatlowers the bar in nominal terms to achieve high rates of recovery.
Pemex's crude production goal for this year is 2.5 million barrels perday on average, down from 2.6 million barrels a day in 2009.
Crude makes up 74% of Pemex's current proven reserves.
Morales said a broader measurement of reserves--3P for "proven,probable and possible"--was in dispute because of a potentialdisagreement with a relatively new regulatory agency, the NationalHydrocarbons Commission.
The dispute is over reserve estimates at the troubled Chicontepeconshore basin, which produced far less crude than expected in 2009despite billions of dollars of investment. Five private firms havecontracts there.
Pemex thinks new strategies at Chicontepec raise the amount ofpossible oil extraction, Morales said. He didn't say how much theestimate varied between the sides.
The oil company is hoping Chicontepec's oil deposits, which lie acrosstwo states, could help replace the declining Cantarell offshore oilfields, which have produced vast amounts of easy crude for decades.
Pemex estimated its end-of-2009 3P hydrocarbon reserves at 43.1billion barrels of oil equivalent. Morales said the final decision onthe level of 3P reserves to be reported is up to the Energy Ministry.
-By Laurence Iliff, Dow Jones Newswires; (52-55) 5980-5184;laurence.iliff@dowjones.com