Random Information - Part 1
I had a wide ranging and quite lengthy discussion with management earlier this week about a number of topics that are related to their work in Mexico as there was little to report on Migration, Upper Jurassic or Chiapas, we just talked. I will share what we talked about.
ROE management (At least Craig Steinke and Kevin Smitth) is at an Energy Conference and will be meeting with other energy companies this week in Mexico where one of the goals in mind is to develop an approach the Mexican Government can use to streamline the regulatory process so that it operates quickly and efficiently. Most developed countries, such as Canada have been refining and stream lining for 70 years or more and Mexico is simply in the first year or two of dealing with private companies and needs a lot of help to streamline the system and make it efficient.
I asked Management if the Mexican officials really had a grasp on how big the effort was going to be and the investment dollars required to get oil production back from 1.75 million BOPD to 2.6 Million BOPD. The answer was that there is a good knowledge by everyone in Pemex. The top Government Officials he was not sure about but they are learning. Management indicated that the first step for Mexico will be to stop the decline. Production will likely decline to about 1.6 BOPD in 2019. Management agreed that it is a massive challenge for Mexico but that ROE and shale oil have the solution. Management explained that ROE has included in every presentation how the shale oil can solve the problem and that with proper development they could get shale production into the 1.0 million BOPD range within a few years. The Eagleford shale formation in the U. S has gone from virtually nothing to 1.6 BOPD in about than ten years.
Management explained that Craig Steinke has delivered many presentations to Pemex and the various Government Departments that show how ROE can develop the Amititlan. They have a presentation with spreadsheets that shows the actual locations for the pads for 400 wells which will bring production to 100,000 BOE (60,000 oil) and maintain it at that level for at least ten years. The budget numbers, the growth and stability rates are all included. This is just part of the ROE plan and presentation. Management says that the CNH, Pemex and the Government Officials are all aware of how this can all come about and that this is just the first stage of development for Amititlan.