Usumacinta rig leak may force well closing

Petroleos Mexicanos may close its Usumacinta oil rig and the Kab 121 oil well in the Bay of Campeche due to a continuing oil and gas leak, according to a senior company executive.

Nov 27th, 2007

Eric Watkins
Senior Correspondent

LOS ANGELES, Nov. 27 -- Petroleos Mexicanos may close its Usumacinta oil rig and the Kab 121 oil well in the Bay of Campeche due to a continuing oil and gas leak, according to a senior company executive.

Pemex Exploration & Production first is "analyzing the corresponding technical alternatives" to determine if the leak can be stopped. "It is a very technical issue." said Mariano Ruiz-Funes, coordinator of advisors to Pemex general director Jesus Reyes Heroles.

Ruiz-Funes told Mexico City's El Universal newspaper that the firm has had problems at the site since Oct. 23, when the Usumacinta slammed into the valve tree of the Kab 121 oil well, causing the leak that has yet to be controlled.

Meanwhile, he said, Pemex will return to "its roots and exploit land reserves, mainly in the municipality of Chicontepec, Veracruz, in order to obtain crude oil, but especially gas in the short term."

Pemex's investment plan
Regarding main investment projects at Pemex during 2007-12, he said it is fundamental to carry them out "together with the investment and participation of the private sector, in its diverse forms."

He said Cantarell reserves will require investments of $11-14.5 billion, despite the field's being in a phase of decline, because 98 oil wells are needed, along with three marine structures and 84 km of pipeline.

Ruiz-Funes also said Chicotepec will require investment of $10.5-14.5 billion for 5,421 new oil wells, while Burgos needs between $7.5-10.5 billion for 2,681 new wells, and Ku-Maloob-Zapp will need $6.5-9 billion for 164 new wells, 18 oil rigs, 50 pipelines, and three storage tanks.

Meanwhile, regarding security in the country's oil industry and the recent attacks that took place on Pemex installations, Ruiz-Funes said Pemex alone cannot protect all its surface installations, some 20,000 in all.

Saying it is "physically impossible" to watch over all these installations with its own personnel or other methods, Ruiz-Funes said the task is for the federal government.

In July, Mexico's Navy, with an eye on potential terrorist attacks as well as recent acts of sabotage, began installation of a radar system to operate in the Bay of Campeche region, home to 70% of the country's crude oil production (OGJ Online, July 27, 2007).

Earlier, Mexico increased security measures at strategic installations in the country following a series of bombings on Pemex-operated fuel pipelines (OGJ Online, July 17, 2007).

Contact Eric Watkins at hippalus@yahoo.com.

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