Ah, Mexico.
Tequila. Mariachi. Adobe. Serapes.
Does the name also bring to mind a land of intoxicating hydrocarbon prospects, of abundant opportunity for oil and gas exploration?
It should, according to Paul Weimer.
Weimer is an AAPG past president and current director of the Energy and Minerals Applied Research Center in the geological sciences department at the University of Colorado at Boulder.
He suggested the oil and gas business is really three different industries today.
“First, an onshore industry that focuses on the development of unconventional resources primarily in the U.S. and Canada. Second, a global industry that focuses on conventional resources in the onshore and shelf regions. And third, a global deepwater industry,” Weimer explained.
“Mexico has an enormous upside potential for these three different play types,” he said.
An Unexplored Country
The Mexican oil industry dates back to the late 1800s, but a combination of history, politics, underdevelopment, remoteness and economics have left a startling amount of Mexican territory undrilled and sometimes even unevaluated.
Imagine a huge expanse of Gulf of Mexico prospects that have barely been touched.
“It is a largely unexplored country, given the size of its basins. How well these plays are developed will depend upon the long-term trends in commodity prices, the rules that the regulators develop, and the business terms for contracts,” Weimer noted.
“Alfredo Guzman, former AAPG vice president and the 2015 Halbouty Medal recipient, has shown in several of his presentations that there are more exploration wells drilled in some counties in the United States than have ever been drilled in the entire country of Mexico,” he said.
Weimer will teach the short course “The Petroleum Industry in the Next Decade in the Americas: An Overview to the Science, Technology and AAPG” at the AAPG International Conference & Exhibition in Cancun in September.
“The specific focus of this course will be on the opening of Mexico to international investment during their Lease Rounds 1 and 2, and the enormous upside potential that exists for all three plays,” he said. “A substantial part is to illustrate how companies have had successes in all three plays, and how the students can take these learnings and apply them to the basins in their country.”
Offshore
Start with those Gulf of Mexico prospects, now being opened to exploration through lease bidding rounds.
“There’s going to be a major leasing for Round 1 in December, so we will get a sense from the IOCs [integrated oil companies] of their relative interest,” Weimer observed.
“The Mexican portion of the Gulf of Mexico, and this is substantially more than the U.S. portion, has four main areas,” he said.
Those areas are:
- The Perdido foldbelt and shallow allochthonous salt extending south of the 26th latitude into the northwest area. “Pemex has announced six discoveries in this area and are seeking partners for development. Five of the discoveries are in upper Paleocene-lower Eocene Wilcox-equivalent reservoirs. One discovery is in the Oligocene Frio equivalent,” he said.
- “Farther south, along the southwestern portion, the second area is devoid of salt and is characterized by many extensional structural styles. No discoveries have been announced,” he noted.
- “A southern salt province is present, with some similarities to the northern Gulf. Pemex has announced six gas discoveries in Miocene sands. One of the papers in the meeting’s Discovery Thinking session will review those discoveries,” Weimer said.
- “Campeche Escarpment, a prominent carbonate margin similar to the Florida Escarpment, sits in the southern and southwest area. No wells have been drilled there in deepwater,” he said.
Mexico has a long history of good production, and Weimer thinks the rejuvenation of old fields and effective enhanced recovery work are outstanding opportunities for the industry.
Several older fields both onshore and offshore in shallow marine settings were offered in Bids 2 and 3 of Round 1, Weimer said, and additional fields will be included in some of Round 2. Some of those blocks have been awarded, and drilling likely will begin in the near future.
“I would say that the upside is quite high. All of the below-ground issues are present – fields with plenty of oil-in-place with bypassed pay, with offset and/or deeper targets. With improved geology, geophysics and reservoir engineering, these should be profitable,” Weimer said.
Unconventional Resources
In addition to offshore prospects and conventional production, Mexico holds considerable promise for unconventional development in resource plays, Weimer believes.
“The possible unconventional plays in Mexico are similar to what we have had good success in developing in the U.S. and Canada,” he said.
“First, they have very rich source rocks, primarily Upper Jurassic, that are in the generation window. In several basins, they sit in areas where there are little structural complications and have good mechanical quality, high pressures and good potential oil quality,” Weimer added.
Just like in the United States, many unconventional play strata were drilled through or bypassed in Mexico, before the industry learned how to stimulate and produce tight formations.
“Potential strata have been penetrated by many wells, in some areas. Heavy oil plays also have a high upside. In some basins, a good pipeline infrastructure already exists. I think the above-ground issues will determine if these are eventually developed,” Weimer said.
Regulatory Landscape
He emphasized that these prospects won’t be developed without operational and financial terms acceptable to the international oil and gas industry, drawing a line between favorable geology and unfavorable regulations.
“A key point that I stress is the separation of below-ground issues – the geology and engineering, and the above-ground issues – the regulators, business terms,” Weimer observed.
The most critical future consideration for exploration and development in Mexico “will be the above-ground issues, in terms of the regulators and financial terms,” he said.
Fonte: http://www.aapg.org
