Mexico’s reserves dip to 15.5 bn boe

Mar 23, 2007 01:00 AM

Mexico's proved oil and gas reserves dipped to 15.5 bn barrels of oil equivalent at the end of 2006, down 5.8 % from a year earlier, Jesus Reyes Heroles, head of state-oil company Pemex, said. The figure, given in a speech in the oil port of Coatzacoalcos, was further confirmation of Mexico's declining energy resources.
As big offshore oil fields like Cantarell begin to dry up, Pemex says it needs much greater investment to be able to explore for oil and gas reserves in deeper waters in the Gulf of Mexico.

But the state-owned monopoly is crippled by heavy tax payments, providing a third of the federal government's revenue.
"Resources left with Pemex after paying taxes are clearly insufficient to sustain investment programs required to reach objectives," Reyes Heroles told oil workers. Pemex's replacement rate for proved oil and gas reserves stood at 41 % at the end of last year, he was quoted as saying.

Pemex has improved its reserves replacement rate in recent years by taking on debtto fund exploration, but is far from keeping up with production. The company will not reach a 100 % replacement rate for proved, probable and possible reserves until 2012, Reyes Heroles said.
Pemex is working to lift output at younger oil fields such as Ku-Maloob-Zaap and Chicontepec, but neither is likely to overtake Cantarell before 2012.

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