Cantarell Collapsing - Production To Fall From 2.1MB/D To 1.3MB/D By September - Pemex Documents

[hatrack]

This report is in Spanish, so I've linked a translation from the Oil Drum - can't vouch for its accuracy.

Production from Mexico's main oilfield, Cantarell, will fall rapidly from September this year. According to the PEMEX 2007 Annual Operating Plan, the development will be producing 700 Mb/d less than the maximum achieved last year, which was 2.1 MMb/d.

With the remaining level of production from Cantarell it will be possible to maintain current levels of production of gasoline - in the Magna and Premium brands - which the country consumes. However, it is equivalent to 50% of the total run of PEMEX's six refineries.

The document, which EL UNIVERSAL has obtained, states that in the fourth quarter Cantarell will be producing 1.329 MMb/d due to its accelerating decline, which will make it harder to achieve the production and export targets fixed by the federal government fot this year.

The plan, which is the driver for the Mexican oil industry, states that as of the end of January of this year the reservoir, considered the sixth largest in the world, will produce 1.723 MMb/d on average, and in December it will be delivering 1.429 MMb/d. However, not even the additional volumes from the Ku-Maloob-Zaap development, which according to ex President Vicente Fox were going to offset the decline of Cantarell, will be enough to prevent the depletion of Mexico's exploitable reserves.

EDIT
Original Source: http://www.eluniversal.com.mx/finanzas/55660.html
Translation Source: http://www.theoildrum.com/node/2179#more

[Joanne98]

1. Peak oil

[hatrack]

2. Not just that - Mexico's economy is about to implode

You think immigration is an issue now? Just wait until 2008.

[n2doc]

3. Especially when the global recession hits and oil drops more in price

There goes Mexico's main source of export revinue...

[Joanne98]

4. Chavez is trying to get OPEC to cut production.

[hatrack]

7. The numbers are not pleasant to contemplate

The Mexican government gets about 40% of their revenue from Pemex.

Pemex in 2005 got about two-thirds of its oil from Cantarell.

Cantarell is falling off a cliff and its production is now projected by fall by nearly half by 2008.

Finally, the other Pemex fields are either (A) in no position to take up the slack or (B) if they have that potential, will require five or ten years of extremely capital-intensive work to even come close.

Good article here from the SF Chronicle.

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2006/06/30/MNGAAJN9JG1.DTL

[Morgana LaFey]

24. So THAT's what the planned "refugee emergency"

is for which the detention camps are being built???? Hmmmm.

Now, can you tell us more about the coming implosion?

[GliderGuider]

26. REX-84 and last year's $385 million KBR contract?

Homeland Security Contracts for Vast New Detention Camps

News Analysis/Commentary, Peter Dale Scott,
New America Media, Feb 08, 2006

BERKELEY, Calif.--A Halliburton subsidiary has just received a $385 million contract from the Department of Homeland Security to provide "temporary detention and processing capabilities."

The contract -- announced Jan. 24 by the engineering and construction firm KBR -- calls for preparing for "an emergency influx of immigrants, or to support the rapid development of new programs" in the event of other emergencies, such as "a natural disaster." The release offered no details about where Halliburton was to build these facilities, or when.

For those who follow covert government operations abroad and at home, the contract evoked ominous memories of Oliver North's controversial Rex-84 "readiness exercise" in 1984. This called for the Federal Emergency Management Agency (FEMA) to round up and detain 400,000 imaginary "refugees," in the context of "uncontrolled population movements" over the Mexican border into the United States. North's activities raised civil liberties concerns in both Congress and the Justice Department. The concerns persist.

Hmmmmmmmmmm..... Oil depletion and global warming may render Mexico inhospitable, and there are already camps waiting north of the border???
'Scuse me while I go tighten my tinfoil. :tinfoilhat:

[Morgana LaFey]

27. Thanks VERY much for producing this article

I have something bookmarked SOMEwhere but ... well, you know the routine.

[profgoose]

19. more on Cantarell at The Oil Drum

http://www.theoildrum.com/story/2006/7/12/10421/4972

http://www.theoildrum.com/story/2006/7/10/145048/052

http://www.theoildrum.com/tag/cantarell

Cheers,
PG

[GliderGuider]

5. What's just starting to sink in

Is the effect this is going to have on northward migration. If the Mexican economy implodes over the next 5 to 10 years, where do all the newly impoverished Mexicans go?

[profgoose]

18. and there's other factors pushing northern migration...

and then combine that with climate change and WHOO-ee...

[murray hill farm]

6. And just the beginning!

As more and more fields deplete, oil countries will need to keep more and more of their diminishing reserves to run their own countries.

[hatrack]

8. Exactly - of the four global supergiants - defined as production > 1MBD . . .

Three are acknowledged to be in decline - Da Qing, Burgan and now Cantarell.

Nobody knows with Ghawar, since the data are state secrets, but the fact that GE just landed a huge contract for twelve mechanical drive packages to maintain water pressure for Ghawar and Khurais doesn't speak of a long-term rosy outlook of low-cost production for an indefinite future.

"Saudi Aramco has selected GE Oil & Gas business for supplying gas turbines to the Southern Area seawater capacity expansion project in Ghawar - the world’s largest oil field - and the Khurais oil field. GE will deliver 12 mechanical drive packages, including seven driven by MS5002C gas turbines and five by MS5002D gas turbines. The expansion project will help to increase Saudi Aramco’s production.

The equipment will be manufactured at GE Oil & Gas facilities in Florence, Italy and shipped to the project sites in 2007, with commercial operation expected to begin in 2008. The GE contract also includes spare parts and training.

“This project builds upon the long-standing relationship we have enjoyed with Saudi Aramco,” said Mohammed Ayoub, Region General Manager - Middle East GE Oil & Gas. “Over the years, we have provided more than 50 units for installation at Saudi Aramco facilities throughout the Kingdom.”

EDIT

http://www.tradearabia.com/tanews/newsdetails_snOGN_article116786_cnt.html

[GliderGuider]

9. The decline in export volumes is predicted to be much steeper than the decline in overall production

For the reason you mention. This bodes ill for importing nations like the USA. America seems to be in the path of an onrushing export train, and the cowcatcher on the front is Cantarell.

[Strelnikov_]

17. EROEI, otherwise know as net energy, is the sleeper issue

as far as I am concerned. And it is an issue the cornucopians have yet to adequately address.

We have used the best fossil resources from a net energy standpoint. As we move forward, the sources will be of lesser and lesser quality from a net energy standpoint. Theoretically, at some point, we are using all the energy generated to harvest energy.

Declining supply, strike one. Less net energy from declining supply, strike two. Climatic collapse, strike three?

[profgoose]

20. fungibility...

yep, I think that's what people don't get a lot of the time. If I have an abundance of a valued resource, I sell it to make craploads of cash, UNTIL it gets to the point that I have to keep my economy running, then I only sell it to folks who I have an economic (or even a realist) interdependence with. The US realizes this and is trying to play it the bully's way out...what they don't realize is that Russia and other powers are a lot more proximate.

[phantom power]

10. You know, that's a bit more than 15% per year.

Which, by the way, was a number that should make any economist soil themselves.

[phantom power]

11. Oh, and by the way, Holy Fucking Shit.

[GliderGuider]

13. Actually, that annualizes to around 45% pa.

The predicted decline of 800 kbpd is 38%, but if that's only over about 10 months. A full year of decline at this rate will come out to 45%. This rate of decline puts Cantarell on track for the worst-case prediction of a 70% decline by the end of 2008. Where did I put my backup Depends?

[phantom power]

21. Yes, that 15% was just a reference to a prediction from last year...

I was just thinking, 15% is really precipitous, but this latest news is far worse. My god.

[Dogmudgeon]

29. Let's see ... that's 'no significant recoverable oil' by 2009, right?

The Saudis can hide the collapse of Ghawar in a thicket of statistics from their collection of oil fields (and they can also reckon Ghawar as a number of subsidiary fields).

But soon, mighty soon, lots of people are going to find out that the biggest oil fields are kaput. Not just the Big Four or Five, but most of the Top Ten ... then Twenty ... then Fifty ...

Anyone taking bets on when the realization will hit?

--p!

[phantom power]

12. Here's a remarkable quote lower down:

He stated that the ex president had not fulfilled his historic responsibility. "Every administration gave its successor the means to increase oil production. But Calderon inherited a declining industry".

Yes, because the planet's supply of oil is purely a matter of will-power. Clap harder, goddammit.
:eyes:

[murray hill farm]

14. This, in the long run, will cause a decrease in illegal immigration

as more and more of the oil fields deplete, more and more the usa will not be able to maintain its own economy, as we know it. Mexico and the Mexican culture is much more able to adapt to a life that was preindustrial. At present, not only does the usa depend a great deal on Mexico for oil imports, but also for a much more important supvival commodity....food. And perhaps more important, as times change, the knowlege of how to survive without cars and the oil to run them. Mexico will much more easily return to an agricultural society. It is the super duper rich life style of the usa that has been fed to Mexicans in the border states...or the fast money of drugs, that brings them to the usa. Once things change in our society due to no oil, that bait fed to mexicans will be rejected to get them to come to the usa to "make good money" will not exist and they will no longer have any interest whatsoever in the usa...and back to basic survival and the old ways of living off the land will have the most appeall.

[GliderGuider]

15. Perhaps, but between now and then I expect to see the all hell break loose along the border.

[murray hill farm]

16. As long as there is the inticement....

jobs and a market for drugs, they will come...illegal immigration only exists because it serves the interests of the employers who hire illegals and those with appitites for illegal drugs.

[truedelphi]

22. But if we as a a nation were getting along with

venezuala or with the Soviet Union, we would have a whole lot of
oil coming our way.

The Soviet Union has uncovered about 45 years worth of oil in the islands north of Japan.

But no we have Mr Belligerent in the White House.

[GliderGuider]

23. If you're talking about the Sakhalin fields, the reserves are much smaller than that.

The two blocks Sakhalin-1 and Sakhalin-2 are estimated to contain 3.3 billion barrels of recoverable oil. At today's rate of consumption of 80 million barrels per day, that's 45 days of world consumption, not 45 years.

Russia's total remaining reserves are on the order of 80 billion barrels, about 2.5 years' supply for the world.

[piedmont]

25. one quibble: It's not the Soviet Union anymore

[truedelphi]

30. I was wondering about that...

What is the politically correct term (The Former Soviet Union?)

You know you are getting old when these things seem to change faster than you can keep up.

[Dead_Parrot]

31. Depends which which bit...

These days, the Commonwealth of Independent States accounts for most of the USSR members, but it's a much looser organisation: Probably better to name specific countries (which is usually Russia)

[Dogmudgeon]

28. The plan for Mexico

I think that there will be strong action taken to economically "quarantine" Mexico. Of course, running out of a natural resource isn't quite like having the flu, but it will be an acceptable drama.

If you are Mexican, it will mean misery.

There is also another sleeper issue, that of the Aztlanistas (also see neutrality notice) -- radical nationalist Mexicans and Mexican-Americans in the Southwest. Any major suffering in Mexico will be blamed, with partial (but substantial) justification, on the policies of the USA, mainly its businesses. The pressure will be on.

I think we've arrived in the post-Peak era, maybe a little early. A number of smaller countries can no longer afford petroleum products. For example, Nigeria can't even pay for its own oil, though in honesty, they also worship at the Church of Free Enterprise.

The peak seems to have come at 85 Mbbl/d about a year and a half ago. Discovery of one or more biggish oil fields could give us a second period on the plateau, but we're on borrowed time as it is. It's action-or-chaos time.

Oh, I forgot -- Bush is still in the White House. Too bad for us.

--p!

[Dead_Parrot]

32. Deep Joy. nt