Mexico shifts to fracking in order to boost Pemex oil production
Mexico plans to use hydraulic fracturing more to access unconventional hydrocarbons and boost oil and natural gas production, after years of declining production. This marks a change in Mexico's stance towards what some call a highly-polluting practice. Evaluation and development of unconventional hydrocarbon deposits hidden deep underground in complex geological formations are part of the 10-year plan to revitalize Petroleos Mexicanos (Pemex), Mexico's heavily indebted energy company.
After a major energy reform in 2014 Mexico tried to exploit unconventional oil-and-gas plays that required hydraulic fracture, or fracking. However, the bidding process to secure contracts was unsuccessful.
The former president Andres Manuel Lopez Obrador ruled out the development of oil and gas via fracking. He publicly condemned this practice, which is opposed by environmentalists because it consumes large amounts of water and pollutes groundwater.
Despite her promise to not allow this production method during the 2024 election campaign, Claudia Sheinbaum has approved it.
Pemex CEO Victor Rodriguez said Tuesday that the company would be addressing all of its geological potential when Sheinbaum's morning press conference was held.
According to the plan, there is a very high potential for oil and gas production in "complex geology" fields. This refers to shale-basins where oil and natural gas are extracted by fracking. The plan says that there is a very significant potential for production in fields with "complex geology", referring to shale basins where oil and gas are extracted using fracking technology. The plan stated that "these types of deposits can change Mexico's declining outlook for production... if plans are developed to encourage private investment in exploration and exploitation."
Pemex wants to increase its natural gas production and stem the decline of crude oil output, which has fallen from 3.4 million barrels a day in early 2000s to around 1.6 millions barrels a day.
TARGETS Mexico, despite being a major producer of oil and gas, remains heavily dependent on the United States for both natural gas and refined petroleum products such as gasoline and diesel. The plan, which was unveiled Tuesday, outlined a modest increase in production of unconventional resources from 2026 to 2028 and a substantial ramp-up starting in 2029. According to the plan's estimates, the cumulative increase in production by 2030 will be 197 millions barrels of crude and 303 billion cubic feet of natural gas. However, Pemex has not provided details about how these increases will be achieved.
Pemex's plans highlighted technological advancements made in the past decade, including well design, drilling, and completion. It said that these advances would minimize environmental impact and preserve freshwater resources.
In an interview Fluvio Ruiz said that hydraulic fracturing techniques and technology have improved since then.
Ruiz stated that "one of the benefits of waiting or being late (to exploit unconventional resource) is there are already very well-designed technical regulations. There's no need for reinventing the wheel." (Reporting and writing by Adriana Barera; editing by Tom Hogue, Ni Williams and Stefanie Eschenbacher)
(source: Reuters)
