THE Gulf of Mexico Oil Thread (merged)

by **marek** » Sat 23 Apr 2005, 07:50:35

The national petroleum giant reports that deepwater deposits in the Gulf of Mexico may be half of what was initially predicted.
BY Noe CRUZ SERRANO/EL UNIVERSAL April 18, 2005
$this->bbcode_second_pass_quote('', 'A')ccording to a new study published on Sunday by state oil monopoly Petroleos Mexicanos, the potential for oil exploration in the Gulf of Mexico has been greatly overestimated.
Petroleos Mexicanos, or Pemex, revealed that terrain in waters deeper than 3,000 meters in the Gulf of Mexico an area known as the Abyssal Plain were "not suitable for oil exploration." The statement represents a serious setback for future drilling in the area, and, according to petroleum analysts, jeopardizes any possible collaborations with foreign investors.

Guillermo Perez Cruz, head of Pemex's Special Unit for Deep Water Oil Exploration, said the new report reduced previous oil estimates in the zone by 53 percent.
Pemex had initially earmarked a possible 54 billion barrels of oil that could be drilled from the area. With that figure now cut in half, Perez Cruz says, exploration becomes economically unviable.
The survey's findings come at a time when the state company is desperate to find new reserves. Recently, it's top executive, Luis Ramirez Corzo, described the monopoly as "on the verge of bankruptcy" with total liabilities of US88.5 billion and an annual investment requirement of US10 billion.

"The financial structure of Pemex is in crisis," he said, noting that the company has US45 billion in debt.
More than half of that, US24 billion, is in off-balance-sheet obligations that must be paid to private contractors upon completion of projects. Pemex is forced to resort to such devices by a tax regime that claims more than 60 percent of the firm's gross revenue for the treasury.

by **Aaron** » Sat 23 Apr 2005, 09:03:56

by **Ebyss** » Sat 23 Apr 2005, 09:20:19

$this->bbcode_second_pass_quote('', 'B')AM!

by **Cyrus** » Sat 23 Apr 2005, 11:30:12

"Its the end of the world as we know it, and I feel fine!!!"

by **jato** » Sat 23 Apr 2005, 19:28:38

$this->bbcode_second_pass_quote('', '"')The financial structure of Pemex is in crisis," he said, noting that the company has US45 billion in debt.

by **Dan1195** » Sat 23 Apr 2005, 20:47:12

No question they are in trouble, Their largest Field, Canterell, is heading into decline this year, potentially a steep one. In addition, Government regulations and high taxes make it difficult to development new fields, especially in deepwater, where costs are higher and PEMEX does not have the expertise.

by **Cyrus** » Sat 23 Apr 2005, 21:56:08

$this->bbcode_second_pass_quote('', 'N')o question they are in trouble

by **JBinKC** » Sun 24 Apr 2005, 03:47:48

Pemex is definitely in deep trouble besides the problems above they also are locked in very undesirable contracts for their heavy Mayan crude which is being sold to certain US refiners for $10 a bbl.

by **pup55** » Sun 24 Apr 2005, 08:12:30

These are the same cheery fellows that announced a 200 gb discovery in the GOM last December that was going to save us all.

http://peakoil.com/fortopic7101.html

We did this calculation the other day to the effect that if Mexico is at or near depletion, they will cease to be able to export oil by 2015 because of growth in their own internal consumption.

by **nth** » Mon 25 Apr 2005, 14:58:52

I don't get how 27B barrels of possible oil is economically unfeasible?
They must be based on $10 per barrel price or something.
JBinKC,
Those contracts are designed so that Pemex can hedge against it. I don't know if they do hedge or not.
Actually, these type of contracts are the norm in the industry. Most are to the benefit of local communities, unlike this one. Normally, it is the private companies that need to hedge.

by **ubercynicmeister** » Mon 29 Aug 2005, 21:34:48

can get into the United States?
I saw this at the oil drum: http://theoildrum.com/
$this->bbcode_second_pass_quote('the oil drum', 'T')he LOOP (Louisiana Offshore Oil Port)is closed, and if damaged, will cause supertankers to be rerouted to Houston, where they barely fit in the channel. If the levee system is busted up, the river might become so filled with silt from the water returning to the Gulf that it becomes un-navigable.

And yes, all the refineries in Plaquemines Parish, Chalmette, and between New Orleans & BR are very much at risk.
But for the industrial damage, everyone will have to wait until the choppers can fly for the offshore damage report, and until the water recedes enough to let people back into the refineries... everyone will have to wait until the choppers can fly for the offshore damage report, and until the water recedes enough to let people back into the refineries. I did hear that two land rigs near Golden Meadow were already down, blown over.
But we always set storm packers in the wells so there shouldn't be anything hosed up except the rigs.

Our big questions are:
1) How many damaged platforms? What type damage?
2) Did we lose anymore rigs?
3) How badly is Port Fourchon damaged? (biggest service port for the oilfield)
4) Is the LOOP operable?
5) How many boats (crew boats, supply boats, seismic boats, cement boats, etc) are damaged or lost?
6) Refinery damage assessment?

by **Colorado-Valley** » Tue 30 Aug 2005, 02:18:41

They could divert the oil carriers to China -- they could probably use it.

Or maybe Cuba ...

by **Specop_007** » Tue 30 Aug 2005, 02:25:03

Specop thinks that worst case, we'd see VLCC's offloading to LCC's then the LCC's going on into the terminals.

The Spice must flow,
Specop_007

by **Specop_007** » Tue 30 Aug 2005, 02:42:30

Interesting site listing ships

Interesting read on tankers

Largest tanker ever

Impressed by big machines,
Specop_007

by **Starvid** » Thu 22 Sep 2005, 19:48:58

$this->bbcode_second_pass_quote('', ' ')According to a new study published on Sunday by state oil monopoly Petroleos Mexicanos, the potential for oil exploration in the Gulf of Mexico has been greatly overestimated. [...]
Guillermo Perez Cruz, head of Pemex's Special Unit for Deep Water Oil Exploration, said the new report reduced previous oil estimates in the zone by 53 percent.

by **jaws** » Thu 22 Sep 2005, 19:51:21

If 100-year hurricanes become a yearly event, the recoverable reserves may as well be 0. Gulf of Mexico cannot be exploited profitably.

by **wisegoat** » Thu 22 Sep 2005, 20:12:32

you mean a monthly event, right?

by **bobcousins** » Thu 22 Sep 2005, 20:38:13

The case of Pemex puts the debate into perspective. We say we are running out of cheap oil. The cornucopians say we just need more investment. Pemex say we can't afford more investment, we're nearly bankrupt.

So yeah, plenty of oil left. Just not economically recoverable. Economics and geology converge to the same result.

And before anyone says it will be recoverable when oil reaches x dollars per barrel, their argument is flawed.

by **backstop** » Thu 22 Sep 2005, 21:10:15

BobC -"So yeah, plenty of oil left. Just not economically recoverable. Economics and geology converge to the same result. "
While I'd agree with this, I think Jaws point of the impact of Climate on production costs is going to be a pivotal factor.
Thus it would appear to be a triple convergence : Geology, Climate & Economics.
regards,
Backstop