EghtesadOnline: A long-awaited auction of Mexico's untapped deep water oil fields on Monday has been fueled by a nearly $3 billion boom in geological data mapping almost inaccessible deposits to open up what the industry sees as the world's "last great proven frontier."
The data rush of the past two years by many top geophysical companies has sparked some of the biggest imaging projects ever for technology also used to hunt for the ruins of ancient civilizations and explain the fate of the dinosaurs, Reuters reported.
"What they're doing is literally rewriting the geological model of the Gulf of Mexico," Juan Carlos Zepeda, head of the national hydrocarbons commission (CNH), Mexico's oil regulator, said ahead of Monday's deep water auctions where the likes of Chevron and BP are expected to participate.
The data bonanza has been an early success of a 2013 energy reform that ended the 75-year old monopoly of Mexican state oil company Pemex in a bid to reverse a 1.2 million barrel per day (bpd) slide in crude production over the past dozen years.
Crude output on the U.S. side of the Gulf of Mexico is forecast to hit a record 1.79 million bpd next year. Mexico has yet to sell a single deep water barrel.
The auction of a total of 11 projects could attract investment in the tens of billions of dollars over the lifetime of the contracts, although the first new streams of oil output, expected from Pemex's deep water Trion project, is not expected until 2022 at the earliest.
The latest geological surveys come from shooting electronic and sound waves deep into the sea floor, which bounce back and are collected by sensors. The data is then processed and re-processed by some of the world's most powerful supercomputers.
They yield detailed models of rock layers dating back millions of years that help oil majors avoid dry wells, a vital step at a time of depressed crude prices given that a single deep water well in the Gulf can cost $200 million.
"The competition has been fierce," said Karim Lassel, country manager for French geophysical firm CGG, which obtained five seismic permits from the CNH over the past couple years.
CGG has been mapping Mexican rock formations for 30 years, mostly as a Pemex contractor, having acquired all of the company's data for its Perdido Fold Belt acreage, where five potentially lucrative projects are up for grabs on Monday.
"I think the deep water Mexico opportunity is one of the greatest opportunities at the moment globally," said Lassel.
SALT AND DINOSAURS
In the past two years, fleets of boats pulling miles-long floating cables dotted with sensors have crisscrossed Mexico's Gulf waters numerous times, teasing out secrets far below.
One survey by U.S. oil services firm Schlumberger covered an area nearly the size of Ireland in just one year with its largest-ever 3D wide-azimuth mapping project.
It explored the Salina, or salt, basin in the Gulf's southern waters, where six blocks are up for auction.
Salt structures are especially promising for oil explorers because they often seal off oil deposits.
Another survey, by Norway's TGS, recently finished the largest-ever 2D survey done at one time, an 18-month project that mapped all of Mexico's Gulf waters using five ships pulling 7-mile-long (12 km) sensor-studded cables.
"Geology does not stop at the border," said TGS executive Will Ashby.
The TGS survey can be merged with well-known deep water trends on the U.S. side of the Gulf, a first for the industry.
The same type of data-gathering has also been applied for a less commercial end: confirming the asteroid strike 65 million years ago just off Mexico's Yucatan peninsula that killed off the dinosaurs and most life on earth.
The first evidence of the 110-mile (176-km) wide crater the asteroid left behind was produced in the 1970s when Pemex engineers extracted drill cores from an unusual circular structure they found in rock dating back to the final dinosaur era.
Since then, nearby discoveries in shallow waters have been the mainstay of Pemex's crude production, contributing nearly 80 percent of the company's 2.1 million bpd of current output.
While oil companies continue to rely on better data to make increasingly expensive decisions, there is still no guarantee a well will produce.
"No matter how far technology has reached," said the CNH's Zepeda, "you cannot be sure what is down there until you drill."