Insufficient investment in technology is the main reason for Mexico’s declining oil production, an executive of its state oil company said in Houston Tuesday.
Mexico’s national oil company, Petróleos Mexicanos, or Pemex, relies on the federal government for its annual budget, limiting the company’s ability to invest in technology for new exploration, said José Antonio Escalera, deputy director of exploration for Pemex.
He spoke with FuelFix after delivering a luncheon keynote address at the Society of Exploration Geophysicists International Exposition and 83rd Annual Meeting.
“Mexico has a huge potential,” Escalera said. “We need technology, we need the development of personnel skills — and budget. If Pemex gets the budget to access the technology and skilled people, the future is very good.”
South Texas: Eagle Ford’s future might lie in Mexico’s demand
Escalera is one of many speakers sharing their geophysical and business expertise at the annual geophysicists’ gathering, which runs through Friday at the George Brown Convention Center. Organizers expect more than 10,000 scientists, seismic computer programmers, data experts and others to visit its many exhibition booths and technical discussions.
Pemex is the focus of a politically charged proposed change in Mexico’s constitution that would expand international participation in the profits and risks of the state-owned monopoly.
Advocates of the proposals introduced by Mexican president Enrique Peña Nieto say that Pemex needs investment and expertise from international companies to boost oil production.
Opponents fear foreign incursion into the resource that has been a source of pride and money since a previous Mexican president nationalized the oil industry decades ago.
Escalera said that some of the plays in the southern Gulf of Mexico with the most potential are also the most complex, and that they differ from formations in U.S. Gulf waters.
Pemex’ advantage is its experience in this geology, Escalera said, but it needs better access to the latest seismic and processing technology.
Since 2004, Mexico’s overall crude output has dropped 23 percent, and production in its once-muscular Cantarell field in the Bay of Campeche has fallen 75 percent, to less than 500,000 barrels a day.