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UPDATE 1-Mexico oil production seen near stagnant for next 14 years
February 29, 2012 / 9:34 PM / in 6 years

UPDATE 1-Mexico oil production seen near stagnant for next 14 years

* Mexico oil production at 2.8 mln bpd through 2026

* With increased investment, output could rise to 3.35 mln bpd

MEXICO CITY, Feb 29 (Reuters) - Mexico’s oil production is seen stagnating at around 2.8 million barrels per day (bpd) over the next 14 years unless the state oil company Pemex significantly boosts investment, the energy ministry said in a report on Wednesday.

The world’s No. 7 oil producer currently produces 2.55 million bpd of oil.

The ministry said in a best-case scenario, investments in production and exploration would jump 21 percent and the country could reach 3.35 million bpd by 2026.

Mexico has managed to stabilize a dramatic decline in production at its largest aging fields but has struggled to replace lost output with new discoveries.

The energy ministry said to reach the base-line goal of increasing production to a level of around 2.8 million bpd from now until 2026 will require 292.333 billion pesos ($22.86 billion) annually, which would include drilling in deep water off the Gulf of Mexico.

But to reach the higher production goal of above 3 million bpd Pemex would need to spend 353.933 billion pesos on improved technology and more exploration.

Oil production is key for Mexico’s finances since the government relies on oil resources to fund around a third of the budget.

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