BIKE: Oil Production Peaks Early in Mexico

[alan_drake]

"Petróleos Mexicanos (Pemex), Mexico's state oil monopoly, said it expects production at its Cantarell oil field to begin declining this year, earlier than previously forecast.

Cantarell is the largest oil field in Mexico, and the eighth largest in the world. The field, which has been in production since 1979, had produced 2.11 million barrels per day in 2004. Pemex expects that to decline by 5% to 2.0 mbpd in 2005. "
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This field is the bulk of Mexican production (~60%). Most of the rest of their production is from fields already in decline. So as goes Cantarell, so goes Mexican oil production.

Note that this is an offshore field, which, as I stated earlier, typically has "loose sand" which gives high early production and then fast decline. 25 years till decline in this case. (UT royalities come from a "tight" field (Yates from memory) that will be @ half of today's production in 40 or 50 years).

5% per year mirrors UK North Sea experience, but a couple more years are needed to confirm the trend %. The trend direction is clear though.

This field doubled production since nitrogen was injected about a decade ago.  Some observers expect long term annual declines of 10%. (Compounded -10%, not straight line, so 1 million b/day ~2013).

Pemex is investing massive amounts in exploration.  But, with the 10+ years to initial production after discovery and another 3 to 6 years to peak production, there is no realistic chance that Mexico will ever see 2004/2005 production levels again.

A close to home example for doubters.

Alan Drake