The Oil Drum

More from Dow Jones Newswires (may be paywalled)

MEXICO CITY (Dow Jones)--Mexico's 2008 oil production target of 3 million barrels a day looks like a fairy tale as output slid for the third straight month in April to a nine-year low.
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One Pemex executive, speaking to Dow Jones Newswires on condition of anonymity, admitted the target is unrealistic considering low production during the first quarter.

The statistics are ugly. The last time Mexican output surpassed 3 million barrels a day was September. Furthermore, Mexico's most difficult months are in the third and fourth quarters when the hurricane season regularly forces the company to shut in oil fields in the Campeche Sound, which pumps around 80% of the country's oil.

Weather forecasters are predicting an active hurricane season this year.

Some relief is coming. Pemex officials expect marine production to increase in May and June. Carlos Morales Gil, Pemex's exploration and production chief, has said the company repaired an 80,000 barrel-a-day marine pipeline in May in the Southeast marine region. In that area, production slipped by an average of 52,066 barrels a day in April versus March.
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Pemex hoped to see Cantarell average 1.3 million barrels a day this year, but has been unable to halt the decline. Since January, Cantarell production has slid by 159,000 barrels a day to the lowest levels seen since 1996.

Pemex officials admit that Cantarell has declined to the point where some former oil wells are now producing natural gas because the oil layer of the reservoir is much narrower. The additional gas will be injected into other parts of the reservoir to help maintain underground pressure.