Mexico gov't doubts mount on Chicontepec oil project

MEXICO CITY, Aug 10 (Reuters) – The multibillion-dollar megaproject that Mexico hopes will turn around its slumping oil industry is being questioned by some officials as results fall short, according to a source familiar with the issue.

State oil monopoly Pemex has banked on an $11 billion plan to tap the unconventional Chicontepec crude deposit to shore up output as yields at other fields plummet, sending Mexican oil production to near 20-year lows.

However, Chicontepec was producing only 30,800 barrels per day in June, a modest rise from December. After years of missed targets and with $3.4 billion already sunk into the project by the end of last year, grumbling about its cost is growing.

“They are coming under a lot of pressure because some people in the government are unhappy with the results. They have spent a lot of money and people are wondering why there is not more oil,” the source said, echoing private remarks made recently by several government officials.

Reuters