Pemex will not invest in deepwater oil projects (Mexico)

24 Jun 2019

Mexican oil company Pemex, which plans to invest around MXN 250-260bn/year (US$13.2-13.7bn/year) in exploration and production over the next few years, has decided not to invest in deepwater fields and to focus in turn on onshore and shallow water projects around the southern Gulf of Mexico, off the states of Veracruz, Campeche and Tabasco. Developing deepwater fields would be too technologically complex and would require too much investments. Pemex's joint venture with BHP Billiton in the deepwater Gulf of Mexico has not started to produce any oil and gas.

Mexico is facing a sharp decrease in its oil production, which halved from 3.4 mb/d in 2004 to 1.9 mb/d in 2018 and around 1.7 mb/d currently. The newly-elected President has pledged to raise Pemex's production to 2.5 mb/d by 2024, and excluded to award more contracts to private companies in new tender rounds, unless the more than 100 contracts already awarded since the oil reform of 2013-2014 succeed in raising investments and crude oil production.

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