Pemex CEO Reaffirms Commitment to Chicontepec

MEXICO CITY (Dow Jones), Oct. 15, 2009

The chief executive of Mexican state oil company Petroleos Mexicanos, or Pemex, said Wednesday that the company will continue developing the Chicontepec oil fields as part of its long-term efforts to raise crude production.

During a hearing at the lower house of Congress, Juan Jose Suarez Coppell said Chicontepec is critical to the future of the country.

His comments came after the head of the National Hydrocarbons Commission last week questioned the progress being made in the Chicontepec basin. The commission was set up to oversee Mexico's oil and gas exploration and production.

Output from the region was only 31,000 barrels a day in August, and production from the geologically difficult deposits is likely to end this year well below initial expectations of 70,000 barrels a day.

Chicontepec covers an area of 3,785 square kilometers in Veracruz and Puebla states and is estimated to have nearly 18 billion barrels of crude oil equivalent in total reserves.

"We can't abandon it, as complicated as it seems," Suarez said. He said it was understandable that the National Hydrocarbons Commission should want to see the project progress faster than it has done.

Pemex's overall crude production has fallen to under 2.6 million barrels a day from a record 3.4 million barrels a day in 2004 as a result of the decline at the giant Cantarell offshore fields.  

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