Cantarell Down 13K B/D In May From April - PEMEX Projects 15% Decline YOY In 2007

[hatrack]

MEXICO CITY, June 26 (Reuters) - Crude oil output at Mexico's huge but aging Cantarell offshore field declined in May, according to data published on the energy ministry's Web site on Tuesday.

Cantarell, closely watched by the oil industry after sharp dips in output, produced an average of 1.579 million barrels per day versus 1.592 million bpd in April.

The figure meant Cantarell accounted for just 51 percent of Mexico's overall crude oil output last month. Over the past year, production has dropped at the field that once produced around 60 percent of state oil monopoly Pemex's oil output.

EDIT

Pemex is drilling horizontal wells to reach into narrow oil seams as Cantarell grows drier. It forecasts the field will produce an average of 1.526 million bpd over 2007, down 15 percent from the 2006 level.

EDIT

http://www.reuters.com/article/bondsNews/idUSN2636032620070626

[glowing]

1. I thought that oil was a surplus and that the capability of refining it

was the problem. Perhaps Mexico is slowing the pump the same way OPEC is slowing their's

[phantom power]

2. Nope. Cantarell appears to be crashing.

[hogwyld]

3. So, are you saying that when the Mexican economy crashes

That there will be an unstoppable flood of immigrants racing for our shores?

[hunter]

4. I think of it this way --

Mexico falls off a ten foot cliff. USA falls off a hundred foot cliff.

It's hard to say which way people will be walking.

U.S.A citizens headed for Canada could become the greater problem.

[Javaman]

5. Mexico tried ethanol, but that raised corn prices and the people went nuts

Mexico tried to privatize the oil, but that is against their constitution and the people went nuts.

Now Mexico has begun raising taxes, no crazy population reaction...yet, but give it time.

40% of the Mexican economy is funded by their oil revenue. When that is gone or gets close to gone, Mexico will either raise taxes, cut gov't services, or both. Then watch as inflation begins in earnest. By that point, the Mexican population will be beside themselves with anger and the shit won't be hitting the fan any longer. The fan will be buried under a hail of shit.

While all this is going on, we americans will be dealing with gas over 5 bucks a gallon, more than likely a major fail off in production, stagflation and the price of food at record prices.

We are fast approaching the end of the era of oil.

word of advice: start your garden now, you will thank yourself for doing so.

[Dogmudgeon]

6. Mexico may be the "miner's canary"

It has all the problems of the USA, only vastly multiplied, yet with a lot less money. And it is our (the USA's) own little sweatshop-cum-whipping boy.

I suspect that Mexico will lease out its heavy/sour crude fields -- Ku-Maloob-Zaap (offshore) and Chicontepec (in the state of Veracruz). They have a significant amount of oil -- nearly 25 Mbbl recoverable -- but Pemex lacks the technology to get to most of it without major expense. The lessees are likely to be US oil companies, and probably also Shell.

Cozy, ¿No?

--p!

[Javaman]

7. What I see for the long run is some sort of deal with the rest of central america

and or south america for investment.

I think the peoples issue with privatization has more to do with U.S. interference than anything.

But we shall see.