New billion-barrel oil find is first by private company in Mexican Gulf in 80 years

DOS BOCAS, Tabasco — Mexico’s decision to allow private companies to explore for oil and gas started to pay off after the discovery of at least a billion barrels in a new offshore field, Bloomberg News reported.

The Zama discovery, 60 km off the Tabasco coast, “is the most important achievement so far of Mexico’s energy reform,” Pablo Medina, the senior upstream analyst for Latin America at Wood Mackenzie, said by email. “It is one of the 15 largest shallow-water fields discovered globally in the past 20 years.”

Mexico opened up to exploration by private companies in an effort to slow and eventually reverse the decline in its oil production. Its output fell by about a third over the past decade, according to data from BP Plc. The nation pumped 2.5 million barrels a day on average last year, the lowest level in more than 30 years. After the country initially struggled to lure interest in its fields, companies including Italian giant Eni SpA have been bidding for licenses and making discoveries. Eni’s earlier oil find came from extended drilling on an existing well.

Tony Durrant, Premier Oil cheif executive. (handout photo)

When Premier Oil and its partners spudded the Zama-1 exploration well in May, the estimates were for as much as 500 million barrels of oil in place. In an interview on Wednesday July 12, Tony Durrant, the chief executive officer of Premier Oil said that figure is now 1 billion to 1.5 billion barrels. Sierra said the primary target reservoir contains 1.4 billion to 2 billion barrels and could extend into a neighboring block.

Premier is taking a “reasonable guess” but said its partners may deem it’s being “too cautious,” Durrant said. Full drilling results due next month are more likely to confirm or upgrade current estimates, he said.

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Source: bloomberg.com

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New billion-barrel oil find is first by private company in Mexican Gulf in 80 years

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