LNG

July 9 (LNGJ) - Italian major Eni has made an oil and natural gas discovery at the Yopaat-1 exploration well in Block 9 offshore Mexico. The preliminary estimates indicate discovered potential of around 300 million to 400 million barrels of oil equivalents of crude and associated gas in place.

   The Mexico discovery is located about 63 kilometres (40 miles) offshore in the mid-deep water of the Sureste Basin. Eni said the well has been drilled in a water depth of 525 metres and reached a total depth of 2,931 metres, finding about 200 metres net pay of hydrocarbon bearing sands. Block 9 is a 50-50 joint venture with Eni as operator and partnered by Spanish energy company Repsol.

Kinder Morgan Inc. (KMI), the leading US pipeline feed-gas company for liquefied natural gas plants and a key energy infrastructure operator and developer, has issued increased financial forecasts for 2024.

The US Government is expanding federal oversight of natural gas pipelines nationwide affecting gas gatherings systems supplying feed gas to LNG export facilities and to domestic pipeline customers.

The US Department of Energy has issued a rule to exclude some licensing and environmental requirements for liquefied natural gas export projects that had previously been required in a show of support for the energy industry by the Administration of President Donald Trump.

The rule, which the Department of Energy issued in a pre-publication notice in the Federal Register, frees LNG export and import license applications from including environmental reviews that had been required under an environmental law, the National Environmental Policy Act.

The DoE said it was updating its National Environmental Policy Act (NEPA) implementing procedures pertaining to authorizations issued under the Natural Gas Act.

“These changes will improve the efficiency of the DoE decision-making process by saving time and expense in the NEPA compliance process and eliminating unnecessary environmental documentation for these actions that the DoE has determined normally do not have significant effects,” said the filing to be published in the Federal Register on December 4, 2020.

The DoE said in the notice that the rule would “save time and expense in the NEPA compliance process”.

The rule is effective 30 days after December 4 Federal Register publication.

Analysts said there was a possibility that a new President could overturn the DoE ruling, but the outcome of the November Presidential election is still unclear amid evidence of poll fraud, which has shocked many people in Europe, Asia, Africa and the Middle East and lowered their regard for American fairness.

The Trump Administration has overseen a surge in natural gas development and US energy independence as the nation has become the world’s third-largest LNG exporter after being an net importer before the shale revolution.

The DoE rule would not affect environmental reviews by the Federal Energy Regulatory Commission, the other government office that reviews LNG projects.

President Trump has supported supplying US allies with LNG and the largest recipients of cargoes have been to countries like South Korea and Japan as well as European countries which have been taking US LNG cargoes as an available alternative to Russian pipeline natural gas.

The Energy Information Agency declared the US the third-largest LNG exporter in May 2019, overtaking Malaysia, after shipments reached a new peak of 4.7 billion cubic feet per day.

The US has six export plants on stream, Sabine Pass and Cameron LNG in Louisiana, Corpus Christi and Freeport in Texas, as well as Cove Point In Maryland and Elba Island in Georgia.

Other projects are under development and about half a dozen are likely to be constructed in the next five years, mainly on the Gulf Coast of Texas and Lousiana. 

Petroleos Mexicanos (Pemex), the Mexican oil and gas company, said its natural gas production rose by almost 2 percent last month compared with the previous month as the nation aims for a medium-term reduction of imports from the US by pipeline and as LNG shipments.

Pemex said its February output of gas averaged 3.763 billion cubic feet per day, an increase from the January average of 3.696 Bcf per day.

Associated gas extracted from oil wells accounted for 73.9 percent of the natural gas total, up from 72.1 percent a year ago.

However, Pemex’s natural gas production in February was down 42 percent from the peak level of 6.516 Bcf per day reached in 2009.

Since 2009, demand has been steadily rising among power companies and industrial customers, making Mexico increasingly dependent on the US imports.

Mexico imported 5.129 Bcf per day of natural gas from the US in 2018, more than four times the 1.258 Bcf per day averaged in 2009.

The nation also receives an average of three US LNG shipments per month and is the largest recipient of US liquefied volumes after South Korea.

Pemex said its crude oil output rose in February to 1.707 million barrels per day from 1.623 million barrels per day in January.

Pemex Chief Executive Octavio Romero Oropeza said that the company had been tasked by the government with reversing the negative trend in exploration and production of previous years and was focusing on rescuing the country’s “oil and gas sovereignty”.

The CEO said he was now working on accelerating the development of 20 new fields in Pemex’s portfolio.

Romero Oropeza explained that of the 20 fields to be developed, 16 were in shallow waters offshore and four were onshore.

He added that the 16 offshore fields would lead to the construction of 13 production platforms and the installation of 14 pipelines with a total length of 175 kilometres.

The CEO stated that the four new onshore fields would also require a high work load, such as the construction of three new drilling platforms and the expansion of nine existing platforms.

The new fields include the natural gas-rich Ixachi onshore field in the southeast state of Veracruz.

Pemex said it expected Ixachi to eventually supply about 700 million cubic feet per day of natural gas and 80,000 barrels per day of condensate.

The Ixachi field would begin supplying gas to the Sistrangas national pipeline grid by the end of 2019 and would help to partially offset declines at mature Pemex fields.