Steep decline expected for Mexico’s main oil field- PIW

Petroleum Intelligence Weekly reports that the Cantarell oil field, provider of roughly 65% of Mexico’s crude oil production, or 2.1 mbd, is due to go into steep decline, with output dropping to about 1.46 mbd by 2006, according to an internal report by the upstream unit of state Pemex.

Cantarell, located in the Gulf of Mexico, is the source of Mexico’s heavy Maya export grade. The output decline makes the hunt for light oil and exploration in the Gulf, including deepwater drilling, all the more important to Mexico, which will take in about $11.2 billion in revenue from Cantarell this year. It will also spoil Pemex plans to increase revenues, which would strengthen the company. Last year, Pemex officials thought Cantarell, which is the subject of a massive nitrogen injection project, would exceed targets and make profits, and the head of Pemex, Raul Munoz, recently said that he wanted to raise crude production by 11% this year, to 3.5 mbd. Responding to public disclosure of the report, Pemex upstream chief Luis Ramirez Corso did not dispute the Cantarell decline, but said that 23 other projects now under way would compensate for the drop, and that Mexico could meet its 2006 output goal of 4 mbd.