Pemex to up oil-field investment 28 percent

State oil monopoly Petroleos Mexicanos said Friday it will increase investment in oil exploration, production and refining by 28 percent this year, amid projections that output will drop dramatically at its largest oil field.

Investment will total about 220 billion pesos ($20 billion), finance director Esteban Levin said during a conference call with analysts.
“This a historical high in terms of Petroleos Mexicanos’ investment spending,” Levin said.

Pemex, as the company is known, will invest about 84 percent of the money in exploration and production and 11 percent in refining, he said.

Pemex’s production levels have been falling steadily — including a 5.3 percent drop in 2007 to a daily average of just over 3 million barrels — primarily due to declining output at its biggest-yielding oil field, Cantarell.

Cantarell’s output will drop by as much as 20 percent this year as the field matures, ranging from 1.2 million to 1.3 million barrels a day compared with an average of 1.5 million in 2007, exploration and production director Carlos Morales Gil told analysts.

Morales said Pemex will be able to stem that decline with new production equipment.
Investment in the field should reach $5 billion this year, Energy Department officials have said.

Experts believe there is much more oil to be found in deep waters of the Gulf of Mexico, but the company has said repeatedly it does not have the money or expertise to get it.

Tulsa World