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The Canadian Press - ONLINE EDITION

Mexico's Pemex estimates crude production will increase to 2.4 million bpd in 2015

MEXICO CITY - Mexico's state-owned oil company Petroleos Mexicanos estimates its crude production will increase to 2.4 million barrels per day in 2015, compared with the 2.35 million barrels per day it expects to produce this year, a company official said Friday.

Gustavo Hernandez, director of Pemex's exploration and production unit, said the upward estimate is based on the company's plans to reactivate hundreds of mature oil fields and start production in recently discovered reserves as part of new rules governing a historic opening of Mexico's state-run oil, gas and electricity industries to foreign and private companies.

Pemex was awarded rights to exploit 83 per cent of the country's proven and probable reserves under the newly enacted opening of the energy business. The company has said it will form alliances with private firms in some of those fields. The government awarded Pemex rights to only 21 per cent of the country's possible reserves. The company had asked for 31 per cent.

The allocations given to Pemex are part of the so-called "Round Zero," the first areas on land and offshore to be assigned under an energy overhaul signed into law by President Enrique Pena Nieto earlier this month. The new law allows private and foreign firms to sign production and profit-sharing deals in the oil, gas and electricity industries. The government expects opening the oil industry to private and foreign firms will bring in $12.6 billion in investment annually over the next three years.

Private exploitation of Mexico's oil and gas drilling is being allowed for the first time since the industry was nationalized 76 years ago.

Hernandez said Friday that more than a third of the country's production will continue to come from the Ku-Maloob-Zaap field in the Bay of Campeche in the Gulf of Mexico.

Mexico is expected to produce 2.8 million barrels per day by 2018, crude production that will come from both Pemex and the other companies expected to enter the Mexican oil market, Hernandez said.

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