Page 6 - LatAmOil Week 27 2022
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LatAmOil                                          MEXICO                                            LatAmOil



       Pemex signs LoI with NFE on




       Lakach deepwater gas project






                         MEXICO’S national oil company (NOC) Pemex   production might begin at the field. However,
                         is set to resume work on the Lakach natural gas   Romero stated on July 1 that the additional
                         field after a hiatus of more than six years under   funds would allow Lakach to come on stream
                         a letter of intent (LoI) signed with its US-based   next year. “With the collaboration of the entities
                         partner New Fortress Energy (NFE).   and regulatory bodies of the federal govern-
                           Pemex’s CEO Octavio Romero Oropeza   ment, this project will finally start production in
                         announced the signing of the LoI on July 1. He   July 2023, and in this way the investment made
                         did not reveal full details of the document, but   will be recovered,” he said.
                         he did say that the NOC and its partner had   The Pemex chief also blamed previous gov-
                         agreed to invest $1.5bn in the Lakach project, in   ernments for the long delays in the develop-
                         addition to the $1.4bn that Pemex already spent   ment of the deepwater field. He described the
                         there before suspending work.        project as one of many “pending issues left by
                           For its part, NFE issued a statement con-  past administrations” on which large amounts
                         firming Pemex’s announcement on July 5 and   of money had been spent with “null results.”
                         revealed some details of the deal. It said it had   Lakach was discovered in 2007. It lies off
                         agreed to complete seven offshore wells at Lak-  the coast of Veracruz State in 988-metre-deep
                         ach over the next two years and would also   water and may eventually yield 400mn cubic feet
                         deliver a 1.4mn tonne per year (tpy) floating   (11.3mn cubic metres) per day of gas.
                         LNG (FLNG) unit to the field. The FLNG ves-  Pemex initially sought to develop the field
                         sel will liquefy most of the gas extracted from   on its own. However, it encountered many chal-
                         Lakach, leaving the remaining volumes, along   lenges, as it had no direct experience working in
                         with any gas condensate production, available   deepwater environments and was not working
                         for utilisation at Pemex’s onshore facilities, it   with a foreign partner. As a result, when Pemex
                         explained.                           sought to rein in upstream spending in 2016, it
                           “NFE and Pemex believe the Lakach field   was included on a list of fields where upstream
                         will yield approximately 10 years of production,   operations were to be halted.
                         with the possibility of significantly extending   Meanwhile, the NOC’s management deter-
                         the reserve life if nearby fields are developed,”   mined that the project was unlikely to succeed
                         it added, referring to two sites known as Kunah   without assistance from an outside investor, but
                         and Piklis. NFE explained that these two sites   it did not make the decision to seek a partner
                         made Lakach a more attractive prospect, as   until last year.
                         they hold around 2.3 trillion cubic feet (65.13bn   Romero announced the company’s plans
                         cubic metres) of gas in addition to Lakach’s 1   in December, saying that Pemex was looking
                         trillion cubic feet (28.3bn cubic metres) of gas   to establish an “association with private sector
                         in proven and probable reserves.     firms” and expected to “be able to recoup not all
                           The NFE statement did not say exactly when   but most of its initial investment.” ™

























                                   Lakach may be developed together with two nearby fields, Kunah and Piklis (Photo: Schlumberger)



       P6                                       www. NEWSBASE .com                           Week 26   30•June•2022
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