Zama Field Reports Delay in Production

López Obrador announced during his morning conference a delay in production at the Zama field, a significant oil reservoir located in the Gulf of Mexico. While PEMEX had initially planned for production to start in 2024, López Obrador stated that it would be postponed until 2025, when the next administration takes office. During the announcement, López Obrador also commended Grupo Carso’s recent acquisition of approximately 49.9% of Talos Mexico, which holds a 17.4% participation in the Zama megafield. The transaction was valued at US$124.7 million.

According to López Obrador, production at the Zama oil field is now expected to start in 2025 and reach its peak in 2029. The president anticipates that daily extraction will range between 150Mb/d and 180Mb/d of light crude oil. Although the current administration will not oversee the production phase, López Obrador emphasized that significant quantities of high-quality Olmeca crude oil will be extracted starting in 2025. Regarding the ownership structure in the Zama field, Talos holds a 17.35% participation, while PEMEX retains a 50.43% stake. Wintershall Dea possesses 19.83% and Harbour Energy holds 12.39% interest in the field.

Private production in the region has been declining due to the limited availability of jack-up platforms. These, essential for offshore drilling operations, have experienced a surge in demand. According to S&P, jack-up rig utilization rates have increased from 75% to 95% in 2023. In the US, usage stands at 82.8%, while in South America, it reaches full capacity at 100%.

As the current administration remains committed to fulfilling its promises of energy self-sufficiency by 2024, the necessity for additional jack-up platforms becomes increasingly evident in order to support the country’s energy objectives. Addressing this challenge will be crucial for the upcoming administration to ensure the efficiency and success of oil extraction operations in the region.

PEMEX expects liquid hydrocarbon production to average 2MMb/d in 2023. Director general Octavio Romero presented this target as part of the company’s strategy to achieve energy self-sufficiency.

The company also aims to increase its production of hydrocarbon gas from 4.224Bcf/d to 4.811Bcf/d by 2024, while reducing the national refining deficit of 901Mb/d in 2018 to only 34 Mb/d by 2024. In November 2018, only 300Mb/d of gasoline, diesel and jet fuel were produced, compared to the 720Mb/d produced in March 2021. The improvement was attributed to the contributions from the National Refining System and the Deer Park Refinery.

Moreover, In January 2023, PEMEX reported a total production of 2MMb/d, seemingly reaching the two-million-barrel threshold promised by the administration. However, the NOC’s production figures included natural gas condensates. This is not a common practice in the hydrocarbons sector as stipulated by the Petroleum Resources Management System. PEMEX also announced that it will retrieve up to 180Mb/d, 10% of national production, from the Zama field.