The National Hydrocarbon Commission, Mexico’s gas and oil regulator, has approved the Talos Energy Company’s appraisal plan operated at Zama-1 discovery situated on Block seven within the Sureste Basin. The CNH is currently looking at the permits needed to start drilling operations. The appraisal plan involves 3 new reservoir penetrations. The Zama-2, the first well, will be dug to a depth of about 500 meters to check on the exploration prospects known as the Marte. This is likely to uncover resource with the value of between 60 to 150 million boe.
Talos Energy feels that Zama-2 to be deepened in the fourth quarter of this year. It also expects the finalization of the program to be done by the mid-2019. The National Hydrocarbon Commission approved a budget of about 325 million U.S. dollars to facilitate the appraisal plan including the 75 million U.S. dollars of the contingent operations, to create the walls and conduct the stem test for the details regarding the reservoir continuity as well as productivity. The expectation by the Talos Energy Company is to divide the cost of between 75 and 80 million U.S. dollars before any contingency cost is included.
The CEO’s Statement
Timothy S. Duncan, the Chief Executive Officer and the President of the Talos Energy said that they were happy to get into another vital milestone with their partners in Mexico, following an announcement that had been made the previous week. He said that the approval would help them keep an accelerated program of the investments regarding the Zama project situated in Mexico. He continued to say that they are likely to commence the drilling operations regarding the appraisal plan any time before the end of the year.
The chief executive officer made it clear that the approval will help them keep on track for their ultimate goal of getting the first production from the discovery of Zama in 2022. This will help them provide local jobs, increase revenue to Mexico, and also promote the Mexican domestic production. Talos also made it clear that Zama discovery is likely to contribute about 10 percent of oil production by Mexico by 2014.
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