Pemex looking to add 180,000 b/d to Mexico crude output with Zama project

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Petróleos Mexicanos (Pemex) submitted the Zama Unit Development Plan (UDP) to Mexico’s National Commission of Hydrocarbons (CNH) for formal approval last Thursday. The project is expected to 180,000 barrels per day (b/d) to Mexico’s crude oil output. 

An Integrated Project Team (IPT) comprised of individuals from all four Zama Unit Holders has been established to manage the development and operation of Zama going forward.

The Zama UDP envisages two offshore fixed platforms, 46 dry-tree wells, and oil and gas transportation to new facilities in Terminal Maritima Dos Bocas. The Zama Unit Holders have also finalised agreements for oil and gas marketing and facilities use based on globally recognised market indices and terms consistent with international best practices, unit holder Talos Energy said. Front-End Engineering and Design (FEED) work is expected to continue while awaiting UDP approval from CNH, expected within the next six months, allowing for a subsequent Final Investment Decision (FID) to be made after all regulatory approvals are obtained.

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The Zama Unit Holders have formed an IPT to manage project delivery and operations during the construction phase. The IPT is designed to provide technical, operational and execution expertise, leveraging the talents from each of the Zama Unit Holders. The IPT will report to the Zama Unit Operating Committee, which includes representatives from each of the companies. Talos, together with Pemex, Wintershall Dea and Harbour, will co-lead different work groups within the IPT. Talos and Pemex will co-lead the planning, drilling, construction, and completion of all Zama wells and co-lead the planning, execution, and delivery of Zama’s offshore infrastructure. Talos, Pemex, and Wintershall Dea will co-lead the project management office.

Talos President and Chief Executive Officer Timothy Duncan commented: “The UDP provides an efficient development plan that we expect to advance this discovery to first production. Separately, the IPT provides important roles for each of the Zama Unit Holders, a structure which we believe best leverages the talents of each organisation and optimises project governance. We understand the importance of this project to Mexico and look forward to continuing our collaboration as we look towards formal approval and to advance the project to FID.”

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Zama was discovered in 2017 and fully appraised in 2019 by the Block 7 consortium, which includes Talos, Wintershall Dea and Harbour. Zama’s expected production represents over 10% of Mexico’s current oil production. Production is expected to be comprised of approximately 94% oil of excellent quality, with API gravities of between 26° and 29°. Zama has been awarded “strategic project” status by Pemex and the Mexican Government. Initial participating interests are Pemex 50.4% (Operator), Talos 17.4%, Wintershall Dea 19.8% and Harbour 12.4%.

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