Kabil, the well fueling exploration in the Misión Block

The extension of the current contract in the Misión Block means a significant step up in Tecpetrol's activity in the Mexican region, coinciding with the company's celebration of 20 years of presence in the area.

The word Kabil comes from one of the ancient Mayan languages and refers to an idea of prosperity, meaning a man who "has a good hand for sowing", which is why the name was bestowed on the latest exploratory well in the Misión Block, located in the Burgos Basin that spans the states of Tamaulipas and Nuevo León.

Kabil-1 EXP is the well that was committed as part of the Additional Exploration Period approved on March 24, 2023 by the National Hydrocarbons Commission (CNH). This extended period represents an investment plan in the baseline scenario of USD 4.87 million that could rise to as much as USD 20.1 million in an incremental scenario.

"The Misión Development Plan was presented to the CNH in 2018, after migrating from the modality of a Financed Public Works Contract (service contract) to an Exploration and Extraction Contract. Tecpetrol is now acting as an operator in partnership with the state-owned Pemex, an agreement which is set to last for 25 years," said Gonzalo Fernández Löbbe, Commercial & Planning Director, to Tecpetrol Hoy. "The Development Plan includes drilling 40 additional wells, and the Additional Exploration Period as well as the recently-approved Modification to the Exploration Plan will allow us to grow our reserves and ramp up our activity in the future," envisioned the executive.

In 2019, Servicios Múltiples de Burgos (SMB), a Tecpetrol company, gained approval for a four-year Initial Exploration Period, which expired on April 23, 2023. Upon its completion, the company obtained approval for a two-year extension to continue its exploration activities. "The Exploration Plan submitted for approval is a complex document of a technical and economic nature, which must be executed with meticulous attention to detail, envisaging interaction with the CNH which will involve several months' work," explained Giovanna Reyes, Regulatory Compliance Sr. Analyst in charge of commercial and regulatory negotiations, to Tecpetrol Hoy.

"In Buenos Aires, we're carrying out all the geological and geophysical studies which will enable us to identify and quantify the Block's exploratory potential," said María Eugenia Aniasi, Principal Exploration Geophysicist, who runs the study team belonging to DIEX.

Two scenarios

The Additional Exploration Period works on the premises of a baseline Scenario, and the commitment acquired includes drilling the Kabil-1 EXP well. It also involves surveying a stratigraphic trap in the Yegua Formation, at a depth of 1,700 meters, whose resources are estimated at 49 bcf with a geological risk of 24%.

The Incremental scenario contemplates drilling up to four additional wells: Cúspide-1 EXP, Lucero-1 EXP, SG Oriental-1 EXP and SG Occidental-1 EXP.

"Based on the results of the special geophysical studies and the drilling of Kabil-1 EXP, there are three other prospective commitments included in the incremental scenario for the Yegua Formation that come to a total of 56 bcf of mean prospective resources," María Eugenia Aniasi clarified.

"Of the four wells in the Incremental Scenario, three depend on the results of the surveys being carried out this year, while the fourth well (Cúspide-1 EXP), of 45 bcf, will depend additionally on the evaluation of the social risks in the area where it's located," added Gonzalo Fernández Löbbe.

"If we take into account the drilling of five proposed wells in both scenarios, this additional exploration period is rather more ambitious than the one stretching from 2019 to the present," observed Giovanna Reyes.

The approval of this second period extends the exploratory life of the Misión Block. "If exploration is successful, we would be in a position to double or even triple the activity projected in the current Development Plan," added Fernández Löbbe, who drew attention to the critical importance of pursuing activities in the country with the sixth-largest shale reserves in the world.

He finished by saying that, "Today, Tecpetrol runs the private onshore field with the highest gas output in Mexico. We are confident that this new exploratory stage will allow us to maintain our leadership position in the private gas production sector."