Mexico Shale Gas May Attract $10 Billion Investment Annually

Thursday, 17 Nov 2011 12:39 PM

 

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Mexico could attract as much as $10 billion of investment per year with shale gas projects, Energy Minister Jordy Herrera said today at an event in Mexico City.

The U.S. Energy Department estimates Mexico has 680 trillion cubic feet of shale gas and has the fourth-largest potential deposits behind China, the U.S. and Argentina, Herrera said.

Herrera said the government is evaluating its strategy for producing shale gas. Shale exploration and production could create 1.5 million direct and indirect jobs over the next 15 years, he said.

“We know it will be a very important factor in the development of our country,” Herrera said.

Without shale gas, natural gas production is forecast to increase 0.5 percent annually on average over the next 15 years. Demand is expected to rise more than 2.5 percent in the same period, which would cause imports of the fuel to climb 6.5 percent a year, Herrera said.

The potential shale gas resources are 11 times the proven natural gas reserves that Mexico has now, Herrera said. With the incorporation of shale gas, the number of years that reserves meet demand would jump to 60 years from 24, he said.

Mexico’s natural gas production has declined 5 percent to 6.67 billion cubic feet per day in 2011 from last year’s average daily production, according to statistics on the website of Petroleos Mexicanos, the state oil company.

Pemex, as the company is known, plans to offer service contracts to operate field labs to explore for shale gas in northern Mexico, said Carlos Morales, the company’s head of exploration and production on Oct. 27.

The service contracts would be similar to those offered at the Chicontepec field and companies have expressed interest, Morales said.

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