ESL Lesson 1
Oil in Our Every Day Life
ESL Lesson 2
The History of Mining
ESL Lesson 3
Economic growth
ESL Lesson 4
Delivery Systems
ESL Lesson 5
Cities and Population Movement
ESL Lesson 6
Recycling
ESL Lesson 7
Rubber
ESL Lesson 8
Farming
Mexico - Cantarell Field in Decline
http://en.wikipedia.org/wiki/Cantarell_FieldCantarell Field or Cantarell Complex is the largest oil field in Mexico, located 80 kilometers offshore (underwater) in the Bay of Campeche. This field comprises (is made up of) four major fields: Akal, Nohoch, Chac, Kutz and the recently discovered Sihil. The first field was discovered in 1976, and then became known as Cantarell complex in 1996. Oil production peaked in 2004 and has declined in the following years. Cantarell complex produced 1.16 million barrels per day of oil in 1981. However the production rate dropped to 1 million barrels per day in 1995. Nitrogen injection projects, started in 1997, that increased the production rate to 1.6 (mbd) to 1.9 (mbd) in 2002 and to 2.1 (mbd) of output in 2003 which ranks Cantarell the second fastest producing oil field in the world behind Ghawar Field in Saudi Arabia. Luis Ramirez Corzo, head of PEMEX's exploration (look for) and production division, announced on August 12, 2004 that the actual oil output from Cantarell is forecast to decline steeply (extreme decline) from 2006 onwards, at a rate of 14% per year. In March 2006 it was reported that Cantarell had already peaked and output is expected to be 14-25 % lower than in 2005.
By 2008 it is estimated only 1 (mbd) will again be all that is produced from Cantarell as it declines. The steep decline is a result of delaying the natural decline using nitrogen injection as the procedure (method) only extracts the oil faster; it does not affect total production volume. The likely ramifications (results) of this decline on world oil markets is highly disturbing.
To maintain heavy crude production of the Bay of Campeche, PEMEX focuses on the development of Ku-Maloob-Zaap complex in adjacent (next to) area, which can be connected to the existing (already in place) facilities of Cantarell. Ku-Maloob-Zaap complex is expected to produce 800,000 barrels per day by the end of decade. PEMEX has been hoping that increased production from newer fields will obscure (cover up) the problem caused by the swift (fast) decline at Cantarell. It is expecting to add 650,000bpd from Ku-Zaap-Maloob and the Chicontepec project. If it hits this target the overall fall in crude oil output will be about 850,000bpd.
Mexican Oil Fields
Map source: http://www.theoildrum.com/story/2006/7/12/10421/4972
PEMEX predicts production drop
El Universal
Viernes 19 de Enero de 2007
According to estimates by the state oil company, Pemex, petroleum exports will decline dramatically during the Calderón administration (time in office). PEMEX is anticipating (expecting) a 13% drop in its crude exports over the next six years as Mexico´s proven reserves continue shrinking. Analysts contacted by EL UNIVERSAL agree that PEMEX's inability to increase production is due to decreasing reserves - particularly the Cantarell field in Campeche Bay which is the source of roughly (about) 60% of the nation's proven reserves.
The first symptoms of a genuine oil crisis are becoming more and more evident. Documents acquired by EL UNIVERSAL indicate (show) PEMEX will be forced to cut back on exports to the United States. The reduction could reach 150,000 barrels per day in the next four years. In the final two years of the Calderón administration, the reduction could reach 500,000 barrels per day.
Currently, around 1.5 million barrels of oil go to the United States daily.
Furthermore, Pemex has already canceled shipments of crude to the Deer Park (Texas) refinery it owns along with Shell for the next 12 months. According to Raúl Muñoz Leos, a former PEMEX director, the primary (major) problem lies in the rapid decline of Cantarell reserves and the failure to develop other fields. Muñoz said production levels rose steadily (evenly) from 2002 to 2004, encouraging company directors to predict a continuation of this trend. "We established a production goal of 4 million barrels a day by 2006, but by mid-2005 production levels began to decline," he said "It is impossible to ignore the fact that our reserves are rapidly shrinking."
PMI Comercio Internacional, PEMEX's export management company, has already begun to notify (tell) some clients (customers) in the United States that it will have to cancel some contracts because production levels are declining. Rosendo Zambrano, the director of PMI, explained that due to the 150,000 barrel-a-day cutback planned for 2007-2010 some contracts that will be sacrificed (given up). Energy analyst David Shields author of two books on PEMEX says “Cantarell is probably going to decline very sharply in the next three years, starting now. Mexico currently produces just under 3.3 million barrels a day. We can expect production to fall to 2.5 million barrels a day, or perhaps even less next year.”
Mexico's Oil Output Cools
by David LuhnowDow Jones Newswires
Monday, January 29, 2007
MEXICO CITY, Daily output at Mexico's biggest oil field tumbled (fell) by half a million barrels last year, according to figures released Friday by the Mexican government. The ongoing (continuing) decline at the Cantarell field could pressure prices (make go higher) on the global oil market, complicate U.S. efforts to diversify (change to a different style of doing something) its oil imports away from the Middle East, and threaten Mexico's financial stability (economic stability).
The virtual collapse at Cantarell -- the world's second-biggest oil field in terms of output at the start of last year -- is unfolding (progressing) much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos, or PEMEX. Cantarell's daily output fell to 1.5 million barrels in December compared to 1.99 million barrels in January, according to figures from the Mexican Energy Ministry. Mexico's overall (total) oil output fell to just below three million barrels a day in December, down from almost 3.4 million barrels at the start of the year. It marked Mexico's lowest rate of oil output since 2000.
This will subtract valuable oil from the world market, which is under pressure from rising demand by growing economies like China and India. It also means less oil going to the U.S. from Mexico, which has long relied on (depended on) Mexico as one of its top-three oil suppliers.
Mexico's growing economy is demanding (requiring) more fuel each year, which is expected to translate to (equal) even lower oil exports. Last year, Mexico's daily average oil exports fell to 1.79 million barrels a day from 1.82 million the previous year. PEMEX says it expects daily exports to fall to an average 1.65 million barrels this year. But some analysts say that is too optimistic (positive). December's daily exports were a meager (small amount) 1.53 million barrels.
Based on the state company's track record so far at Cantarell, including its current rates of recovering the oil that remains in the field, Mr. Shields expects the field's output to drop another 600,000 barrels a day by the end of this year (2007). He says that PEMEX will likely increase output by 200,000 barrels a day at other fields -- leaving the country with a net decline of 400,000 barrels a day by year's end and daily exports of less than 1.4 million barrels.
Mexican Yearly Oil Production
Graph source: http://www.rigzone.com/news/article.asp?a_id=40538
Continue to: Kuwait
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Economic growth
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Mexico
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Kuwait
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China
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U.K. and Norway
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Russia