Skip to comments.Mexico’s drug cartels are standing in the way of a fracking bonanza
Posted on 02/25/2014 4:59:03 AM PST by thackney
If all goes well, drillers responsible for a shale-oil bonanza in Texas will soon cross the southern US border and extend the hydraulic fracturing boom to Mexico. But first the Mexican government, foreign oil companies or some combination of the two will have to neutralize some of the most savage gangsters in the world.
Oil and gas were a key subtext of yesterdays North American summit between Canadian prime minister Stephen Harper, Mexican President Enrique Peña Nieto and US President Barack Obama. Hoping to join the US and Canadian energy boom and invigorate the laggard Mexican economy, Peña has pushed through a dramatic reversal of the countrys seven-decade-old ban on private oil and gas drilling. His goal is to lure companies that are drilling in the deepwater Gulf of Mexico and the Texas shale patch to lead the development of Mexicos potential 42 billion barrels of oil.
Trade rules will have to be relaxed to allow the US companies to quickly move labor and special equipment back and forth across the border when needed, experts here say. But more importantly, Peña has to deal with the Zetas and Gulf Cartel, two vicious drug- and gun-running gangs whose turf overlaps Mexicos shale patch. Nabbings, extortion, murder and oil theft by the gangs have made US drillerstraditionally cavalier about violence in the areas where they workwary of venturing into the shale-rich states of Tamaulipas, Coahuila and Nuevo Leon.
Tamaulipas is not in government control. There is not a single business there that in some way does not pay off the organized crime groups, said Louie Palu, an American war photographer who reported in the gang-run states from 2011 to 2013.
Peña has set a target of raising Mexicos oil production to 3 million barrels a day by 2018, a 25% increase from 2.4 million barrels a day today. But in shale, Mexico is essentially starting from scratch. State oil company Pemex, until now a monopoly, has drilled only a handful of shale wells. Meanwhile, just across the border in Texas, 11,000 well permits have been issued for the Eagle Ford shale in the southern part of the state. They have been drilled by wildcatters like Apache, Devon and Petrohawk, companies that have helped to resurrect Texas as a global oil powerhouse.
Eagle Ford alone produces some 1.2 million barrels of oil a day, and half of the 38,000 square mile field lies within Mexico. While no other nation has managed to duplicate US and Canadian success in hydraulic fracturingthe method used to drill shale oil and gas, popularly known as frackingMexico has perhaps the best shot because it can access the Eagle Ford.
It will be a game-changer if we are successful in bringing down the successful shale operators from the US, industry consultant Luis Miguel Labardini told Quartz.
But businesses operating in the Mexican states bordering shale-rich Texas and the Gulf of Mexico have been especially vulnerable to gang extortion. Pemex, operating conventional fields in the region, has also suffered from theft, often assisted by oil workers in cahoots with the gangs. Last year, Pemex found 539 siphons along its pipelines in Tamaulipas.
The Zetas and Gulf Cartel are somewhat weakened after a government crackdown the last two yearsZetas kingpin Miguel Angel Trevino Morales was arrested last year in Tamaulipas, for instance. And Peña last month unveiled a new national agency to strike at the gangs. Yet kidnapping was up by 20% last year, carried out by surviving factions and remnants. Kidnappers have tended to target Mexicans and not foreigners, but that will be slender consolation given that most of the employees working the fields will be locals.
Theyre very violent, these drug dealers, said Montserrat Ramiro of the Mexican Institute for Competitiveness. You have to be vigilant of your employees so they dont get kidnapped. If you dont have a beefed-up security strategy, you can be extorted.
I have read that a major impediment to fracking in Mexico is a lack of sufficient water for the fracking process.
I doubt that. I would say Mexico is the biggest impediment, or particularly their PEMEX regulations (that are getting better), the use of PEMEX to fund social welfare over investment for the future, and crime.
“the method used to drill shale oil and gas, popularly known as fracking”
Every time I read something like that I just shake my head.
I know, they just added to the populations ignorance.
I’m thinking this is a new opportunity for Black Water.....
Can you say why? I genuinely do not know but I feel sure you do.
Fracing takes place after the drilling is complete, it’s not part of the drilling process. Fracing takes place after the rig has already moved off location, in some cases months later depending on availability of a contractor.
Hydraulic Fracturing, or Fracking, is not a method of drilling.
It is only done after the drilling is completed.
It creates cracks spreading out from the drilled hole, the wellbore, to increase flow into the well.
Yes. First wireline sends down the “ guns “ and they fire projectiles into the shale.
Then they pump the solution down the hole. They move up the well, set a plug and the process begins again.
On the Mesa near Pinedale wyoming they would set as many as 18 plugs.
Next comes the work over rig that drills out the plugs.
Been there. Did that
I might add that fracing is not a new process it’s an old one but with the horizontals it’s done on a larger scale in several stages. On a vertical well I’ll frac one zone, one a horizontal I’ll do multiple fracks in the same zone over a few thousand feet. With a vertical I go down and hit the zone, with a horizontal I’ll go down and not only hit the zone but run horizontaly in the zone. Sinstead of a 50 to 100 ft zone I’ll have a zone a few thousand ft long. Thats why we need multiple stages in the same zone.
Just pump in refried beans.