Since 2004, Pemex, Mexico’s embattled petroleum monopoly, has been faced with one crisis after another. It all started in the mid-90s, when Pemex was forced to begin a radical intervention on its largest oil reserves, the Cantarell field, in order to keep production numbers from plummeting. It was able to stave off disaster for almost a decade, building the largest nitrogen production plant in the world to inject the inert gas into Mexico’s dying wells. But the inevitable, ultimately, could not be stopped.
By 2004, Mexico’s oil wells had begun their terminal descent into depletion. This threatened one of Mexico’s largest industry’s with annihilation at a time of great turmoil for the country.
Boom turns to bust, Mexico dramatically shifts strategy
In the early 90s, everything was looking up for Mexico. For almost 20 years, the Cantarell field had produced crude oil at rates that frequently put it at the top of the world’s ranks of oil-producing regions. Mexico had reaped this windfall with open arms, converting a once backwards tin-shack wasteland into the jewel of Latin America. By the mid-90s Mexico rivaled Florida as a retirement destination for U.S. snowbirds. Its tourist destinations were among the most visited in the world and it offered a level of safety and security that hadn’t been seen among its Latin American kin nations since the first Conquistadors set ashore.
That changed dramatically in 2004. By 2013, Mexico’s total crude production was just a fraction of what it had been 10 years earlier. It was clear to all that something drastic needed to be done, and fast.
But Mexico had an ace in the hole. Geologists had discovered a total of over 90 billion barrels of oil. The only catch was they were located in tough shale deposits and deep-water offshore sites. Mexico didn’t have the technology or capital to extract it. President Nieto thus opened the Mexican market to foreign firms.
As the Mexican oil industry moves into its privatized future, Cotemar will be there every step of the way, working the contracts that may prove to drive Mexico’s biggest oil boom yet.