The Zama oil field development extends from Block 7 into the neighbouring block to the east, which is operated by Pemex
Talos Energy and Pemex receive instruction to unitize Zama field. (Credit: Pixabay/C Morrison)
US-based oil and gas company Talos Energy has announced the receipt of official notice instructing the partners of Block 7 and Petróleos Mexicanos (Pemex) to unitise the Zama field within 120 working days.
In a partnership with Wintershall Dea and Premier Oil, Talos is the operator of Block 7.
The Zama oil field development extends from Block 7 into the neighbouring block to the east, which is operated by Pemex.
The constitution of a formal unit is required for a final investment decision (FID) and field development to maximise the value of the reserves from the field.
Mexico’s Ministry of Energy (SENER) has ordered the four parties to prepare a Unitization and Unit Operating Agreement (UUOA) for approval.
UUOA will be a governing document of the unitised consortium
The UUOA will be a governing document of the unitised consortium over the life of the Zama oil field that will address some of the topics that include initial participating interests, roles of the parties, and reimbursement of exploration.
It will also address appraisal costs spent to date, and a redetermination mechanism for adjusting the initial participating interests as additional technical data is collected.
Talos president and CEO Timothy S. Duncan said: “We are encouraged by the progress that SENER, CNH, and Hacienda have made on the Zama unitization process despite these difficult times, they have worked with transparency and in the interest of accelerating value creation through the Zama discovery.
“We have continued to invest in the front-end engineering and design work despite the recent pullback in commodity prices, so we can remain on pace to submit timely development plans.”
The Zama development is expected to include two fixed production facilities with a combined capacity for 150 thousand barrels of oil per day and associated gas.
Furthermore, the platforms are expected to be the deepest facilities ever installed in Mexico at about 550 feet (170 meters) of water once they are installed.
In December last year, Talos Energy has struck deals worth $640m to acquire a portfolio of producing assets, exploration prospects and acreage in the US Gulf of Mexico.