In the week that Mexico, Canada and the US concluded negotiations for the new USMCA trade agreement, CNH advised an action plan to reach the next administration’s crude oil production targets, approved Talos Energy’s appraisal plan for Zama and authorized Jaguar E&P’s farmout with Vista Oil & Gas. Meanwhile, Argentina is poised to prepare its own bidding round for offshore exploration and Saudi Arabia is bringing out the big bucks to increase its spare oil production capacity.
Ready to drill through the week’s top stories? Here’s your weekly news roundup:
CNH Considers Next Administration’s Crude Oil Production Targets Viable. While the industry’s regulator evaluated the next administration’s crude oil production objective of increasing production levels to 2.48 million b/d by 2024 as technically viable, it also stressed the importance of injecting US$20 billion of investments per year into PEMEX’s exploration and production activities. Meanwhile, the industry’s regulator also approved Talos Energy’s appraisal plan for Zama and authorized transfer of 50 percent of the rights and obligations for hydrocarbon exploration and production obtained in Round 2.2 by Jaguar E&P to Vista Oil & Gas.
Mexican Senate Rules Petroleum Union Election Amendment. The Plenum of Mexico’s Senate approved an urgent agreement point proposed by MORENA’s parliamentary group. In it, the Ministry of Employment and Social Prevision is to request Mexico’s Petroleum Union (STPRM) adjust its union statutes on the principles of freedom and secrecy for the upcoming election of its leadership. The union’s elections are to be withheld until such provision is fully implemented. Moreover, the country’s Chamber of Deputies and the Senate have confirmed the new configuration of their respective Energy Commissions.
Benefit Margins of Gasoline Sales on the Rise. Mexico’s northern states are witnessing an increase in the benefit margins of gasoline sales, increasing from 6 percent/L to 12-15 percent/L. Gasoline price liberalization and PEMEX discounts on first-hand sales throughout 2018 are among the primary factors.
Crude Oil Prices Alleviate Federal Budgetary Pressure. Variations in international crude oil prices could translate into increased federal income and a lessened budgetary pressure for President-elect López Obrador’s incoming administration.
CRE Unveils IMP Study to Use Ethanol-Mixed Gasoline. The Mexican Petroleum Institute (IMP) published a report where it compared CO2 emission levels between MTBE and ethanol when added as a 10 percent proportion of the gasoline used in the Valley of Mexico. The IMP concluded emission levels were not significantly different between the two additives.
Equinor, Eni and Petoro Consortium Unveil Appraisal Well Completion. Norway’s Norne field is far from dry. Initially scheduled for shutdown in 2014, the volume potential of 50-70 million barrels of recoverable oil enclosed in this discovery projects Norne’s productive life as far as 2036.
Argentina is Preparing Offshore Tender. The government is setting things in motion to tender 40 offshore blocks, extending from Argentina’s center to the west Malvinas basin. The country hopes to emulate the success of Mexico’s licensing rounds and Brazil’s exploration and production tenders after 20 years of virtually no investment in exploration.
Saudi Arabia is Planning to Invest US$20 Billion in Spare Oil Production Capacity. The Kingdom stands out as the only oil producing country with a significant spare capacity in case the market requires it. At present, Saudi Arabia has a maximum sustainable capacity of 12 million b/d.
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