Revving up. On March 2, the Energy Secretariat (SENER) published its revamped strategy to drive the country’s oil and gas bidding rounds. The principal changes are to establish standard block sizes, to open all blocks simultaneously for nomination by private parties, and to hold two bidding rounds per year. The three-step nomination scale — high, middle, low — will help SENER gauge private-sector interest across the country’s reserves and to rank the latter both domestically and internationally. While nominations are open to anyone as of the announcement, there will be a three-month period prior to the launch of a bidding round for SENER to evaluate which blocks to include. It looks as if SENER is in a hurry to maximize the country’s oil rent. (Source: SENER)
Up in smoke. On March 6, Mexico state oil company Pemex announced it was slashing its budget for harnessing natural gas. On the heels of Pemex posting its financial results for 2016, which revealed a 296 billion peso loss (US$14.3 billion), upstream regulator National Hydrocarbons Commission (CNH) revealed that Pemex had informed it of a 15% decrease in planned investments to harness natural gas, from $3.6 billion to $3.03 billion. Back in November, Pemex had said it would invest the former amount in the Ku Maloob Zaap field, which delivers 40% of the company’s oil production and 10% of its natural gas production, but it decided on the cuts last February. Venting of natural gas at Pemex rose to nearly 10% in 2016 due primarily to an accident on the Abkatun-A platform. Under the revised plan, Pemex expects to reach 98% utilization of natural gas by late 2019, of whatever’s left. (Sources: CNH, Forbes, Oil and Gas Magazine)
Within you, without you. On March 9, during the 2017 CERAWeek by IHS Markit conference, Juan Carlos Zepeda, chair of CNH’s executive board, suggested that Pemex might use underwater pipelines with spare capacity on the U.S. side of the border to transport oil and gas from the deep water Trion field in the Gulf of Mexico. The Great White field, operated by Royal Dutch Shell and Chevron, is a mere 25 miles away from Trion, and has 50% capacity available in a line connected to the United States. The alternative would be to build new infrastructure to reach the Mexican coast in Tamaulipas state, some 112 miles away. While the suggestion breaks new ground in integrating North American energy markets, it also raises new risks, lest opposition parties cry foul about the pledge to develop the domestic industry and supply chains. (Source: Reuters)
Slow train coming. On March 10, independent pipeline system operator Cenagas stopped receiving submissions for its first transportation capacity open season. Cenagas first estimates show that demand surpasses supply by almost 30%, or 3.5 million gigajoules (GJ)/d to the 2.7 million GJ/d on offer. While Cenagas officials expressed satisfaction at the preliminary estimates, industry analysts pointed out the backlog of pent-up demand and the shortfalls of Mexico’s infrastructure to service it. Likely, Cenagas will make a sizeable profit on this open season, but it should also make progress in laying out plans to break the bottlenecks sooner rather than later. (Sources: SENER, Cenagas)
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