Mexico’s natural gas production averaged 3.82 Bcf/d in June, down from 4.35 Bcf/d in the same month last year. Output has been down on a year/year basis each month since the start of 2024, and has fallen sequentially in every month except May.
National oil company Petróleos Mexicanos (Pemex) accounted for 3.62 Bcf/d, or 95% of all production in June, down from 4.12 Bcf/d in the year-ago month.
The top five natural gas producing fields in June, all operated by Pemex, were Quesqui (552 MMcf/d), Ixachi (531 MMcf/d), Akal (302 MMcf/d), Maloob (139 MMcf/d) and Onel (122 MMcf/d).
Associated gas tied to oil production comprised 1.95 Bcf/d of total output, with non-associated gas supplying 1.87 Bcf/d. Crude oil production, meanwhile, averaged 1.57 million b/d, compared with 1.67 million b/d last June.
Pemex on Friday reported a net loss of 255.9 billion pesos, or $13.9 billion, for the second quarter of 2024, compared with a profit of 25.4 billion pesos during the year-ago quarter. The company said associated gas production fell by 16% year/year during 2Q2024, mainly because of a decline from the Akal, Zaap and Ayatsil fields, as well as the closure of cyclical wells in the Northeast Marine Region.
Due to Pemex’s stagnant production and the firm’s substantial natural gas needs, domestic production only provided 2.29 Bcf/d, or 24%, of Mexico’s total gas supply during the 30-day period ended July 17, Wood Mackenzie data show.
Pipeline imports from the United States, meanwhile, averaged 7.01 Bcf/d over the same span, up 116 MMcf/d from a year ago. Summer is typically Mexico’s peak demand season for natural gas.
Mexico’s dependence on U.S. gas has allowed it to benefit from a prolonged price slump in the oversupplied North American market. Mexico’s IPGN natural gas price index averaged $2.471/MMBtu last month, versus $3.527 in June 2023.
U.S. natural gas prices during the first day of bidweek trading for August delivery were trending upward at several locations on Thursday (July 25) amid sweltering temperatures, according to data from NGI’s Bidweek Alert.
For Pemex, domestic natural gas production has taken a backseat under President Andrés Manuel López Obrador, who has sought to revitalize the firm’s production of refined products and fertilizers in order to reduce imports of each.
Pemex this month signed an agreement to supply natural gas feedstock for a 20-year term to a fertilizer plant in Veracruz state under development by Portuguese firm Mota-Engil SGPS, SA.
President-elect Claudia Sheinbaum, a close ally of López Obrador, has signaled plans to continue López Obrador’s energy policies, which prioritize strengthening Pemex and state power company Comisión Federal de Electricidad. Sheinbaum’s inauguration is set for October 1.
