Page 8 - LatAmOil Week 13 2020

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M E X I C O
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This would likely trigger a sell-off by several major investors that have to hold investment grade assets.
The ratings agency also left Mexico’s sover- eign rating two notches above junk. “The pro- nounced COVID-19 and oil price shocks, in our view, exacerbate Mexico’s already modest growth,” it said in a statement.
S&P also put Mexico’s outlook on negative and reduced the country’s long-term local cur- rency sovereign credit rating from A- to BBB+.
Mexico’s economy dipped into recession last year, and market players are concerned that the COVID-19 pandemic could strain the economy even more. S&P said it expected the Latin Amer- ican country’s gross domestic product (GDP) to shrink by 2.0-2.5% this year.
“The downgrade reflects our revised
expectations that real per capita GDP growth will remain below that of peers with a similar level of economic development,” S&P said.
Pemex recently said it was planning to reduce its administrative expenses and contracts this year in order to help deal with the impact of fall- ing crude oil prices.
Octavio Romero, the company’s CEO, said that the aim was to save approximately $217mn in contract costs and $27mn in administrative costs in 2020.
Another US-based ratings agency, Fitch Ratings, has said that Pemex is the “most vul- nerable” among its peers in Latin America. It also suggested that the NOC might need more government support and higher revenue from its refining business to help withstand the price slide caused by the pandemic.. ™
TRINIDAD AND TOBAGO
Predator set to push ahead with EOR project for Columbus in Trinidad
LONDON-LISTED Columbus Energy Resources is preparing to move forward with an enhanced oil recovery (EOR) project in Trinidad.
In a statement dated March 31, Columbus confirmed that its partner, Jersey-based Preda- tor Oil & Gas Holdings, still intended to launch the next stage of a gas-injection initiative at the Inniss-Trinity onshore oilfield. “Columbus and Predator continue to advance the CO2 pilot pro- ject. We look forward to the next stage of con- tinuous injection,” said Leo Koot, the executive chairman of Columbus.
Meanwhile, Predator said in a separate state- ment that it had already laid the groundwork for
the second stage of this pilot project. “The com- pany has injected more CO2 into [the] AT-5X [well] as part of initiating Phase 2 of the CO2 EOR pilot project and has observed encourag- ing downhole pressure build-up ... The next step is to inject CO2 at even higher pressures and on a continuous basis,” it reported.
Predator further stated that it did not expect
the recent decline in world crude oil prices to
affect its plans. “The company’s enhanced oil recovery (EOR) project in Trinidad remains on
track for revenues, and encouragingly for Pred-
ator, the project economics are still attractive
even [with] WTI [at] $20 per barrel,” it said in
the statement. 
Inniss-Trinity is an onshore oilfield (Image: Range Resources)
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w w w . N E W S B A S E . c o m Week 13 02•April•2020