Bloody Mexican Shale Fields Sit Idle While Texas Booms
"We must reinvent ourselves or die," said Federico Alanis, owner of a family-owned aluminum business in Reynosa.
He and others are hoping transformation will come from a major energy reform passed late last year that ended state oil giant Pemex's 75-year-old monopoly and promises billions in new investment. The reform is "a blessing from God," Alanis said.
The U.S. Energy Information Administration says Mexico's total combined shale oil and gas potential is the world's seventh-largest at 117 billion barrels of oil equivalent, far more than the 60 billion Pemex estimates.
While Pemex has limited shale expertise and has focused on more profitable oil and gas projects further south, the company believes Mexico holds 32 billion barrels of oil equivalent (boe) in shale oil alone.
That exceeds the deepwater potential Pemex sees in the Gulf of Mexico. That area is often seen as the main advantage of energy reform, whose fine print is still being debated in Congress.
But when it comes to shale development, Mexico is just getting started.
In the last few years, Pemex has drilled fewer than 20 test shale wells in the shale-rich Burgos basin, an extension of the Eagle Ford Formation in southern Texas.
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