Summary
The Rigzone Newsletter on June 12 quoted Peter Millard of Dow Jones Newswires who reported that Mexico’s state oil company has an improved outlook on production from Cantarell and Ku Maloob Zaap oil fields. Together the two fields produce over half of Mexico’s 2.7 million bbl/day output. Ku Maloob Zaap has now overtaken Cantarell as Mexico’s largest producing field. Cantarell has declined to one third of its peak level. Petroleos Mexicanos (Pemex) is now beginning to correct past negligence at Cantarell. The company is reopening wells that produce high volumes of water. This year, Pemex opened an oil/water separation plant at Dos Bocas, a seaport near Cantarell where crude oil is exported. While average water production at Cantarell is 7%, some wells produce at a 40% cut. It is the water production that caused the decline of Cantarell. Reopening of the wells has not yet improved production. April production fell to 713,036 bbl/day from754,063 in March. The problem is still there.
Analysis
The fundamental problem with Cantarell is that it has a bottom water drive on one side of the field. On the other side the bottom is impermeable. Bottom water moving up structure drowned the pay zone causing the loss of reserves. Discovered in 1976 and placed on production in 1979, crude oil production peaked in 1981 at 1.156 million bbl/day from 40 flowing wells. Production was then stabilized at 1 million bbl/day by drilling more wells. In 1995 production/well had fallen to 7,000 bbl/day and 150 wells were required. Pemex then installed gas lift which allowed production to rise to 1.4 million bbl/day in 1999. But reservoir pressure continued to decline. After lengthy study, Pemex decided to inject nitrogen into the dome of the field with the intention of driving the bottom water back to its original level. The injection began in May of 2000 and was considered a success. The original reserves for Cantarell were estimated to be 17 billion barrels. After nitrogen injection had driven the oil/water level back to its original horizon, the estimate was increased by 2.3 billion barrels. By December 31 of 2006, cumulative production was 16.6 billion. As production continues to decline, the remaining reserves are expected to be produced until 2014. Recent new technology introduced by Pemex could result in a further minor reserves increase allowing Cantarell to be economic for as long as 2019. But then the cash flow will equal the operating cost and the field will be abandoned. Ku Maloob Zaab, discovered in 1979 is smaller and deeper than Cantarell. Pemex has plans for stabilizing production there using similar methods to those at Cantarell but it is not clear if this will be a success. Once water production appears in an oil field, it becomes a greater and greater problem with each passing year. Some success has been achieved in recent years by squeezing water sensitive elastomers into wet formations. Saudi Aramco, notably, has reduced water cut in Ghawar field by this method. But there the wells are shallower and work over jobs are less expensive. Only time will tell if Pemex can significantly reduce the decline rate in the entire Cantarell complex which includes over 20 oil fields, most of them much smaller than Cantarell or Ku Maloob Zaab.
