Since Mexico enacted its energy overhaul in 2013, the world’s attention has mostly focused on the country’s vast offshore potential. But upcoming farm-outs of mature fields will usher in enticing opportunities for experienced operators to carry out EOR and hydraulic fracturing.
Though Pemex will contractually still hold 50% working interest, new players will operate the two proposed farm-outs at Cardenas-Mora and Ogarrio.
Pemex’s field administrators revealed in 2015 the most important challenges that new partners at their mature farm-outs must address. Among them was the pressure behavior at Cardenas’ three naturally fractured reservoirs—two Cretaceous and one Kimmeridgian—which would require EOR to increase recovery factors. Over the last 10 years, pressure has remained stable at an average 200 kilograms per cubic centimeter at Cardenas’ reservoirs, while Mora’s current pressure hovers at 100 kilograms per cubic centimeter, Carlos Pérez, Pemex’s former Bellota Jujo asset administrator, said during Upstream Day, a closed-door event hosted by Pemex.
Development at the Cardenas and Mora fields dates back to 1982, when Pemex’s efforts led it to peak production of about 175,000 barrels per day (Mbbl/d) and 320,000 cubic feet per day (Mcf/d) just a few years after. However, output has steadily declined over the past decades, which is why EOR and artificial lift systems are needed to rejuvenate the two fields. Currently, less than one-fifth of the state oil company’s 110 wells are producing. Most recent production figures show Cardenas yielding about 4,200 bbl/d and 14.8 Mcf/d while Mora lags at about 3,300 bbl/d and 6.2 Mcf/d.
Cardenas and Mora are located northwest of Cardenas City and about 60 km from Villahermosa, Tabasco—one of Mexico’s oil and gas hubs. The Cardenas Field is set in a 104-sq-km area, and Mora in 64 sq km. The fields’ combined 3P reserves reach 94 MMbbl of oil, mostly 39 degree API (° API) crude. Infrastructure in place at Cardenas-Mora includes two separation facilities, two compression stations and a few oil and gas pipelines.
Ogarrio, the other farm-out, is much older. Development began in 1964 about 50 km southeast of Coatzacoalcos, Veracruz, in a 150-sq-km area. About 100 wells are producing about 6,500 bbl/d, down from an average 15 Mbbl/d in 2012. Gas production is currently about 24.8 Mcf/d. The mature field currently holds 3P reserves estimated at 54 MMbbl of 37° API crude in Miocene sandstones.
Pemex divided the field into three blocks: A, B, and C.
Arturo Ramírez, who was asset administrator for the Cinco Presidentes oil fields in 2015, said during the event that Block A needs secondary recovery methods, while blocks B and C require EOR strategies. Additionally, horizontal, multilateral wells and hydraulic fracturing at low permeability zones could squeeze out the field’s riches. Ogarrio’s infrastructure includes two balanced pumping units, three oil pipelines, three gas pipelines, two separation facilities and one compression station.
The new operators at Pemex’s two farm-outs on offer will be announced Oct. 4, according to the National Hydrocarbons Commission. The license contracts will be awarded for 25 years, and operators are entitled to two five-year extensions.
Pemex has stated that it is considering 52 other farm-outs, mostly located in southern Mexico. As medium-sized operators ramp up production at their recent Round 1 onshore acquisitions, increased activity is expected to transform Mexico’s legacy assets and revitalize the overlooked potential of EOR in the country’s mature fields.