[joewp]

$this->bbcode_second_pass_quote('Prensa Latina', '
')
Mexican Company Predicts End of Oil

Mexico, Jul 27 (Prensa Latina) Petroleos Mexicanos (PEMEX) announced that oil reserves may run out in seven years.

"Supplies of this economically exploitable resource are running out," informed a report sent by the state owned company to the United States stock market.

Until December 31, 2005 the report says proven reserves were about 8.978 billion barrels, while yearly production was 1.322 billion tons. If this rhythm continues oil will run out in the time stipulated..

El Universal newspaper reports that experts of the PFC Energy Advisory company based in Washington pointed out that investments for PEMEX exploration is also running out of time.

Even if heavy investments were made now, new oil fields would take from six to eight years to be ready and, consequently, Mexico may have to import oil to satisfy the internal market, it warned.

The newspaper quotes Carlos Ramirez, PEMEX spokesman as saying that if necessary investments were made, this would provide another 2.9 more years to what is foreseen with the proven developed reserves.

The director of the state owned company, Jesus Reyes, insisted that these are difficult moments due to a reduction of production in Cantareli, the main oil field in the country.

[Zardoz]

$this->bbcode_second_pass_quote('Prensa Latina', '
')
Mexican Company Predicts End of Oil

Mexico, Jul 27 (Prensa Latina) Petroleos Mexicanos (PEMEX) announced that oil reserves may run out in seven years.

"Supplies of this economically exploitable resource are running out," informed a report sent by the state owned company to the United States stock market.

[SchroedingersCat]

Let us remember that Mexico is the third largest exporter of oil to the US, after Canada and KSA. Will they use the remaining oil for internal consumption or send it all north to the US? If they stop exporting by choice, what do you think the US will do?

[canis_lupus]

Seems to me if they mean "seven years" they really mean "pretty $@$% soon...anybody have any suggestions?"

[grink1tt3n]

$this->bbcode_second_pass_quote('canis_lupus', 'S')eems to me if they mean "seven years" they really mean "pretty $@$% soon...anybody have any suggestions?"

[eastbay]

'... oil reserves will run out in seven years.'

Of special interest to the motorists in the USA would be Mexico's oil 'exports'. The article refers to 'oil reserves', but it doesn't estimate the all important point when the production decline line finally crosses the domestic useage line. That's when exports reach zero, meaning that's when Mexico's government takes a revenue cut of somewhere around 60% compared to this year. It seems as though that magic moment should occur quite a bit earlier than seven years from now. Maybe two or three years???

It's interesting to speculate about what will happen to Mexico. There is no possible optimistic scenario.

[Cobra_Strike]

In Matts 'bug out now?' thread someone said they felt we have two years...I doubt it.

There is likely to be demonstrated reductions in production by the end of the year.

7 years to no production...10% decline *might* even be a little bullish.

[jdmartin]

Whoah!

My first thought is maybe this is Pemex's way of trying to force the hand of the Mexican Gov't to make some infrastructure/research investments instead of siphoning off everything. Or a ploy to shock the market, so that the price becomes higher - after all, their main customer isn't going to quit buying oil because the price went up, unlike some other countries elsewhere.

On the other hand, maybe they see the handwriting on the wall. It seems odd that information of that nature wouldn't be more of a state-secret, to be shared with the Mexican Gov't first, than to be faxed over to Wall Street..

[frankthetank]

Cobra-

I think that was me. I might have to review my options!

Where will the US steal/i mean get the difference from? No wonder we want into Iran/Venezuela. Also no wonder why they want a fence up so bad down there, those Mexicans already have it tought, wait until the oil money dries up (i'm guessing the average Mexican sees very little, but still).

[Starvid]

Remember, oil is fungible. It doesn't matter who exports to whom. It's a global market and all importers will be hurt the same.

[joewp]

$this->bbcode_second_pass_quote('Starvid', 'R')emember, oil is fungible. It doesn't matter who exports to whom. It's a global market and all importers will be hurt the same.

[Starvid]

Now, that's old thinking.

The relevant question is: where the heck is demand going to be destroyed?

[Chesire]

$this->bbcode_second_pass_quote('joewp', '')$this->bbcode_second_pass_quote('Starvid', 'R')emember, oil is fungible. It doesn't matter who exports to whom. It's a global market and all importers will be hurt the same.

[Starvid]

At least we know what we are going to do with all the Mexicans who starve to death.

[IrrationalExuberanceMonky]

"Even if heavy investments were made now..."

About as much chance of that happening as Hugo Chavez having a round table with George Bush and the late Milton Friedman on Exxon acquiring PDVSA.

NOC cash cows, gotta love 'em.

[Starvid]

$this->bbcode_second_pass_quote('IrrationalExuberanceMonky', '"')Even if heavy investments were made now..."

About as much chance of that happening as Hugo Chavez having a round table with George Bush and the late Milton Friedman on Exxon acquiring PDVSA.

NOC cash cows, gotta love 'em.

[Jack]

Thank you, Leduck, for your thoughts and insights - and welcome to PeakOil!

Since Mexico is an important player, due both to oil and its proximity to the U.S., I hope you'll add more input as matters develop.

[Tanada]

The way I read the article even if everyone throws money at the problem in mass quantities they will be done in 10 years.

I don't think a mass of money is going to be thrown if that is the good scenario.

TS is HTF

[keehah]

Mexico: A Nation-State Dissolves?

[Twilight]

US EIA: Mexico

It's fairly simple, they use 2.1mb/d, they currently export 1.46mb/d to the US and falling. That's their entire production.

Throw a massive decline rate into the field that makes up 60% of their production, and whether you use the EIA's 14% or the likely 25%, they are screwed. You are looking at 3-7 years to zero exports depending on how optimistic or pessimistic you want to be. That's 3-7 years to the effective end of the government's budget.

Not even the cornucopians can say much about it since we have data transparency adequate to remove most of the guesswork.