Mexico Oil Production at Record Low, Foreign Investment May Boost Numbers
Oil production in Mexico is at a record low.
Petroleos Mexicanos, which is owned by the state, is on the verge of receiving investments from abroad, according to the Houston Chronicle. This may spell change for the ninth-largest oil producer, but in 2014, Pemex produced 2.43 million barrels daily, which marked a decade of declining production.
Most of December, the company produced 2.35 million barrels per day, and data from the rest of the year supports that production is in decline.
There hasn't been numbers this low since 1990, the year that the information was first made public. The year 2004 was the high water mark, and 2014's daily numbers are almost 1 million behind.
There may be a change for Pemex as it becomes funded by foreign investment. The country's Energy Ministry believes the decline will end as a result, and by 2018, there will be a 500,000-barrel increase.
Mexican President Enrique Peña Nieto made it possible for non-state owned companies to extract crude oil by signing legislation in 2013.
In 2015, Pemex is supposed to produce 2.4 million barrels daily.
In 2013, it produced 2.522 million barrels a day, according to the Wall Street Journal.
Sometime in 2015, Mexico will accept bids for production-sharing contracts, and some believe this will be an easy way to address production problems that have been plaguing the country.
"Mexico decided to start with what could be the easier stuff," said Miriam Grunstein, an expert with Rice University's Mexico Center. "A production sharing agreement involving cost recovery and shallow water seems to be the easier target for Mexico to address at this point."
Other types of agreements, such as deep water contracts and production licenses, will be offered later in the year.
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