Mexico's Pemex has outlined plans to drill as many as 500 wells, build more than 100 production platforms and install more than 4000 kilometres of pipelines between now and 2024.

The state oil company is pursuing its goal to increase production in the country, work it says will generate an average of 47,000 jobs per year.

Pemex this week rounded up the plans it has in place to raise production to an average of 2.48 million barrels per day of oil in 2024, and said a more detailed business plan would be presented this summer.

Increasing all types of hydrocarbons output remains vital to President Andres Manuel Lopez Obrador, who spoke this week at a presentation in Tierra Blanca, Veracruz, the site of the company’s Ixachi discovery.

“Things are going well in the energy sector and especially in Pemex, wherein the goal is to stop the fall in oil production and stabilise it at an average production of 1.7 million bpd and from there work on its improvement,” Lopez Obrador said.

That will start with a focus on 20 fields set to be fast-tracked to development, with the goal to start production from 12 of those areas this year.

The administration is also opting to add the Onel and Yaxche fields to its proposed list of 20.

“Everything related to the infrastructure of the 20 new fields this year is contracted 100% and in progress,” Pemex chief executive Octavio Romero Oropeza said.

“Meanwhile the infrastructure for the Onel and Yaxche fields is in the bidding process and we expect to have it contracted in July of this year.”

Part of that workscope has included rig contracts, the company said in a presentation.

The company has awarded a $692 million integrated services job covering 15 wells at the Xikin, Esah and Uchbal fields to Marinsa and Grupo R.

A second package valued at $1.29 billion and covering 44 wells at the Chocol, Valeriana, Cibix and Ixachi fields was awarded to contractors Mexoil and Perfolat.

A third package that was set to be finalised this week covers 15 wells at the Mulach, Manik, and Tclam fields, valued at $505 million, went to a consortium led by contractor Opex, according to the presentation.

Two additional packages were due to see work wrapped up by the end of the month. The fourth, covering 31 wells at eight different fields including Pokche and Cheek, is due to see winners announced on 23 May.

The final process, covering 23 wells at four fields, is due to see results announced on 31 May.

The administration is targeting the drilling of 50 wells in 2019 as part of that programme, of which three have already begun drilling.

Upstream previously reported that Pemex had chosen consortia led by Eseasa Offshore and Bosnor, affiliated with Grupo R, to handle platform fabrication contracts representing a combined value of $775 million with a workscope of 13 platforms.

Pemex officials said they see the onshore Ixachi field as especially important, with that area already producing 3900 barrels per day of high-quality crude and 30 million cubic feet of gas.

By 2022, the company is targeting production of 80,000 bpd of light crude and 600 MMcfd of natural gas, or about 220,000 barrels of oil equivalent per day.

Pemex also said it aims to focus on development of about 20 to 40 fields per year in addition to those first 20 to be initiated in 2019.

The company added that exploration will be key to help fill up the hopper of future development projects, with 50 exploration wells planned for this year and 20 already in progress.

Assuming a success rate of about 35%, that implies between 15 and 20 fields will move forward to development.

The company cited successful results already obtained at the wells of Quesqui-1 in Huimanguillo, Tema-1 in the Litoral de Veracruz area and Ichilan-1 in the Litoral de Tabasco area.

“Exploration will allow us to see a production scenario on the rise, in which we predict to develop between 20 and 40 fields per year throughout the administration,” Romero Oropeza said.

“This will allow us to estimate with a good degree of certainty that we will achieve the goal of increasing production in the coming years.”

During the event Lopez Obrador also affirmed that Mexico’s government would help Pemex pay for the ambitious projects through investment in its budget and reduction of taxes.

The aim is for the company to be self-financing and emerge as “consolidated”, generating a surplus by the middle of his six-year presidential term.

Lopez Obrador has been keen to avoid new debt, and reiterated that goal.

However, the presentation was short on specifics of the financials and did not address how Pemex, already among the most indebted oil companies in the Americas, would propose to fund its ambitious upstream plans while also assuming the burden of building a new refinery which the administration sees as vital to bolstering domestic fuel production.

Ratings agencies and private sector analysts, some of whom have already dropped the company's bond rating, have said such actions could worsen the company's already negative financial position.

Lopez Obrador said in recent weeks that Pemex would take on that refinery project mantle after a range of private-sector bids came in over the $8 billion initially proposed.

Development plans for most of the initial fields targeted for the fast-track have yet to attain regulatory approval, meantime, and are pending a green light by upstream regulator CNH.

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Pemex posts plans for major output increase