Petroleos Mexicanos, the world’s third-largest oil producer, expects output from its aging Cantarell field to gain this year, allowing the state-owned company to boost production for the first time in eight years.
“We foresee a stable and increasing Cantarell field,” Chief Executive Officer Juan Jose Suarez Coppel said yesterday in an interview in Houston. Expected output at the field, which fell 11 percent last year, “makes us comfortable” that Pemex will reach its goal to increase production this year, he said.
Mexico has sought to stop declining output at Cantarell, the world’s third-largest field when it was discovered in 1976, by injecting gas and using other recovery methods. In the past decade, Cantarell’s production slid 74 percent to 500,674 barrels a day last year, dragging the country’s daily output to its lowest level since 1990 of 2.55 million barrels.
“We plan to increase production to 2.7 million barrels in the next couple years,” Suarez Coppel said. Pemex will produce 3 million barrels a day “by 2017 or 2018, given that we invest enough.”
The company, based in Mexico City, plans to invest an annual average of $25 billion to reach production goals and upgrade its refinery system, according to a five-year business plan on Pemex’s website.
“The reality is that we expect small increases in many of our projects, including Cantarell,” Carlos Morales, head of exploration and production said in Warsaw today.
Suarez Coppel, 52, said that high oil prices are increasing the risk of a global demand disruption.
“Nobody in the industry is comfortable with these levels,” Suarez said. “Historically, what you’ve seen is that prices at this level do destroy demand.”
Crude oil for April delivery reached $110.55 a barrel on March 1 on the New York Mercantile Exchange, the highest intraday price since May 4. Oil traded at $106.06 at 12:22 p.m. New York time.
Saudi Arabian Oil Co. is the world’s largest crude producer, followed by the National Iranian Oil Company. Petroleos de Venezuela SA is trailing Pemex’s production according to Bloomberg data.