Mexican Petroleum Resumes Oil Exports As Weather Improves

Text of report by Mexican newspaper El Financiero website on 31 October

[Report by Esther Arzate: "Pemex begins to resume crude oil exports"]

As a result of improving weather conditions, Mexican Petroleum (Pemex) reported that it has resumed exporting crude oil on vessels after the reopening of the port of Cayo de Arcas, Campeche. As a result, the state enterprise will restart operations to recoup part of the suspended daily production of 600,000 barrels of crude oil and natural gas in Campeche Sound.

However, the ports of Pajaritos, Veracruz, and Dos Bocas, Tabasco State will remain closed to navigation, as well as storage vessels FPSO and FSO in Campeche Sound.

Last Sunday Pemex suspended production and shipment of the 600,000 barrels of crude oil that the company exports, mainly to the United States, due to a fifth cold front.

Nonetheless, the state company announced that as of noon yesterday PMI International Commerce (the Pemex division in charge of buying and selling hydrocarbons) resumed operations loading crude oil for export on tanker vessels in Cayo de Arcas, which will allow Pemex Exploration and Production Division (PEP) to partly resume petroleum production in Campeche Sound.

The oil company is confident that it will resume crude oil shipments today through the port of Pajaritos, as well as on vessels Ta’kuntah and Yuum K’ak’naab.

It is worthwhile mentioning that suspending production of 600,000 barrels per day of crude oil (which represents 20 per cent of total output) results in approximately $46.8 million per day in losses for Pemex because it affects sales on the international market where the average price per barrel is $78.

However, the real impact will be seen at the end of the month once the state oil company resumes normal operations and makes up production and shipments that were suspended due to severe weather conditions.

Pemex produces 3.1 million barrels of crude oil per day, of which 1.7 million barrels are slated for exports and the remaining output supplies the domestic market.

Strengthening the State Enterprise

While taking part in the last day of activities of the Mexico Forum, 2007 Business Summit, Energy Secretary Georgina Kessel Martinez reiterated that Mexico is rich in hydrocarbons. The secretary added, however, that Mexico will have proven oil reserves for approximately nine years if 2006 production levels are maintained.

The secretary added that if the country’s total reserves are added to prospective resources, “we Mexicans own almost 100 billion barrels of crude oil; this amount will supply us with hydrocarbons for more than 60 years at current production levels.”

Kessel said that over 55 per cent of the country’s prospective resources are located in deep waters in the Gulf of Mexico and almost 90 per cent of these deposits are in depths of 1,000 meters or more, which poses a very significant challenge in terms of technology.

Georgina Kessel said oil in Mexico has not run out but that we should be very creative to ensure that prospective resources can become proven reserves.

Lastly, the energy secretary reiterated that petroleum resources will continue to belong to the Mexican people and underscored the need to strengthen Pemex.

Originally published by El Financiero website, Mexico City, in Spanish 31 Oct 07.

(c) 2007 BBC Monitoring Americas. Provided by ProQuest Information and Learning. All rights Reserved.