Reports of Mexican oil demise appear to have been exaggeratedAugust 29, 2012
Mexico is one of the three largest sources of US oil imports, consistently delivering over 1000 barrels per day on an annualized basis for over 15 years. As such, the health of the Mexican petroleum industry is of major strategic interest to American analysts. Over the last few years, Mexican oil production has clearly been in decline as their oil fields age and the industry suffers from lack of investment.
Today, however, will probably mark a reversal of that decline. Mexican President Felipe Calderon has announced that PEMEX, the national Mexican petroleum company, has discovered their first ever high yield, light crude, deep water well in the Gulf of Mexico. The finding is significant not just for its size, but for its quality – it is the easy to process and highly desirable light crude (most of Mexico’s reserves are of heavy crude). The discovery is in the Perdido Fold Belt of the western Gulf of Mexico, off the coast of the northern state of Tamaulipas. It is estimated that this particular well could deliver 400 million barrels, and that the entire sector could yield 29 billion barrels – which would increase Mexico’s proven reserves by nearly 50%.