Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Thu Feb 09, 2006 11:28 am Post subject: Re: Cantarell Oil Production to "drop precipitously&
This is serious. If this story has seen the daylight than they must know that they have a major problem on their hands. To slow the water you can will need to reduce rates and/or the interval from where you produce. Also shutting in wells may help. In a nut shell, You Will Need to Lower the Production Rates !!! _________________ Men argue, nature acts !
Voltaire
"...In the absence of the gold standard, there is no way to protect savings from confiscation through inflation."
Joined: Feb 09, 2006 Posts: 417 Location: Venezuela
Posted: Thu Feb 09, 2006 12:19 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&
When I worked in the S. Mexican oil market (onshore) back in the late 90's, I seem to remember that Pemex was building a huge nitrogen injection project for the Canterell field. I found that odd that since it had been my personal experience that nitrogen was typically one of the worst 'contaminants' that could be injected into a pressurized hydrocarbon system......CO2 yes, but N2? No. Anyway, don't know what ever became of that project.
Posted: Thu Feb 09, 2006 12:25 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&
CNBC just did an interview with the author of the WSJ article. Not a bad interview, but they didn't talk about the steep rate of decline. The word is getting out, if slowly.
Joined: Feb 09, 2006 Posts: 417 Location: Venezuela
Posted: Thu Feb 09, 2006 12:32 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&
CNBC just finished interviewing a couple of Latin America energy analysts. One said that the leading candidate for President in July's election has said that he'll not change Mexico's long-standing policy of not allowing investment by foreign exploration and production companies.
Again, my experience in Mexico is somewhat dated, but I seem to recall that there was a move in that direction back in the late 90's when some foreign E & P companies were thinking that they'd be able to participate in some of the gas plays (like Burgos) along the border with Texas.
If Mexico has any 'elephants' left to discover, they're probably in deep water GOM, and I don't believe they've got the money, expertise, or desire to tackle those plays right now.
Joined: Dec 02, 2005 Posts: 6755 Location: Oil-addicted Southern Californucopia
Posted: Thu Feb 09, 2006 12:58 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&
Connect the dots, folks: A sudden, super-steep decline of production, and the loss of oil export revenue, will precipitate severe economic hardship in Mexico. We all know what that will mean, don't we? There will be a huge increase in illegal immigration north, into the U.S.
Is that the "immigration emergency" KBR is talking about in their PR release about being awarded the detention camp contract? link
The Bush administration knows what's coming. They're experts on Peak Oil, but of course they're keeping very quiet about it. They're making all sorts of moves to prepare, and the building of 400 million bucks worth of concentration camps for Mexican illegals is just one of them.
Posted: Thu Feb 09, 2006 1:00 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&quo
Cantarell has one of the worlds largest nitrogen injection programs. They've kept reservoir pressure up that way, along with water. As noted often, these programs do not add to additional production, they simply advance the curve so the decline rates at the end are much steeper. Look at what's happened to Oman!
The maquiladoras in Mexico run on cheap energy. If you think we have a displacement and imigration problem now, wait until Mexico has to somehow pay to import energy and pay first world prices for it. We are about to watch a massive economic collape take place on our Southern border.
There are unexploited Deep GOM areas. Mexico will have to liberalize their paternalistic approach to foreign investment to make those feasible, however, and it will take years to bring on stream if at all.
Joined: Oct 12, 2005 Posts: 281 Location: Washington State, USA
Posted: Thu Feb 09, 2006 1:02 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&quo
I thought this quote from the WSJ article was revealing:
Quote:
Pemex says the study's most pessimistic scenarios represent a "do nothing" approach and are highly unlikely as long as the company carries out the right maintenance work on the field to work around the spreading gas and water, which make extracting oil much more difficult. Pemex officials privately say the report was intended by senior engineers at the company as a wake-up call to management and Mexico's Congress, which approves Pemex's budget each year, to act quickly to prevent a steep decline.
It is typical of government run oil companies ( and private ones too!) to want to milk as much profit in the short run, while minimizing investments for the long term. This report seems to indicate frustration on the part of Pemex engineers that the capital investment budgets that are being appropriated are not enough for the engineers to do their job. It is sort of telling non-technical government officials they have to give this golden oil goose some more feed or the black gold is going to quit coming.
"Put more money back into Cantarell improvements and maintenance, or suffer the severe consequences", is my short interpretation. Imagine the problem for US oil production if our Gulf Mexico oil production expenditures had to compete in the US Congress with all the other funding requests! _________________ An expert is someone who has made every mistake possible in their field and learned how to prevent them.
Posted: Thu Feb 09, 2006 1:03 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&quo
...I recall readling a projected 14% decline rate post-peak for Cantarell, due to the use of massive nitrogen injection. That is why "technology" is such a double-edged sword when it comes to oil production.
Mexico's Cantarell field decline deferred to 2006
by Rigzone staffer
August 12, 2004
The head of exploration and production at Mexican state oil monopoly Petroleos Mexicanos, or Pemex, said Thursday that the decline of the country's biggest oil field has been delayed until 2006.
...Cantarell supplies about two thirds of Mexico's 3.4 million barrels a day in crude oil output, producing 2.2 million barrels a day of heavy crude...
Ramirez said Thursday that the decline in Cantarell, originally expected last year, has been delayed until 2006, when the deposits are expected to begin declining at a rate of 14% a year.
The next government will have to make some difficult decisions about the oil industry.
...
Because in a democracy (which is such a fantastic system we have to kill people to encourage them to adopt it) you can't deal with bad news proactively.
So its always a problem for someone else, sometime later, but not me guv, the buck never stops anywhere. _________________ "Complex problems have simple, easy to understand, wrong answers." - Henry Louis Mencken
LONDON (AFX) - Mexico's huge state-owned oil company, Petroleos Mexicanos, or Pemex, may be facing a steep decline in output that would further tighten global oil supply and add to global woes over high oil prices, the online edition of the Wall Street Journal reported.
Posted: Thu Feb 09, 2006 2:44 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&
Shakespear1 -
I guess they'd need to self-insure projects, with credible and verifiabale assets, to attract any substantial foreign investments -
at which point the weather becomes the measure of recoverable GOM reserves - as is happening in the North Sea fields.
regards,
Backstop _________________ "The best of conservation . . . is written not with a pen but with an axe."
(from "A Sand County Almanac" by Aldo Leopold, 1948.
Posted: Thu Feb 09, 2006 2:49 pm Post subject: Re: Cantarell Oil Production to "drop precipitously&quo
How far offshore does Mexico's mineral interests reside? Do those boundaries tend to coincide with the 'international waters' maritime law (10-15 miles offshore) provisions, or are there other treaties/provisions in place for mineral interests? (plz forgive my ignorance) The reason I ask is simple: why can't U.S. companies drill a few miles out further off of Mexico in 'international waters?' I suppose they can't because they'd be too far from a base of operations, unlike GOM operations out of Houston or New Orleans. And it's a political hot potato, of course. _________________ "It's called the American Dream because you'd have to be asleep to believe it."
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