Eni announces oil and gas discovery at Area 9 in the Gulf of Mexico

Eni has made a new oil and gas discovery in the shallow-water Gulf of Mexico which could hold as much as 400 million barrels of oil and gas, the Italian firm said July 8.

The discovery was made at Area 9, an area where Eni is considering to develop a production cluster with projects that may not be viable on their own, but which could be commercially attractive if developed together.

Eni said it had made a new discovery on the Yopaat-1 exploration well, which had been authorized by the upstream regulator in April. The preliminary estimates indicate a potential of between 300 and 400 million barrels of oil and associated gas at Yopaat, Eni said.

Yopaat is one of the wells Eni Mexico is considering for the cluster, together with two others from the adjacent Area 10 also operated by the Italian firm, Saasken and Saasil, where the company struck oil. The drilling of Saasil was authorized in late January; Saaskem is already being appraised.

The overall estimate of resources in place in the areas currently exceeds 1.3 billion barrels of oil equivalent, the company said.

This allows "to advance with the studies towards a potential future hub development," it said.

The well was drilled in a water depth of 525 meters and reached a total depth of 2,931 meters, finding about 200 meters of net pay hydrocarbon bearing sands in the Pliocene and Miocene sequences, the company said in a statement.

The area is one of the busiest in exploration activity in Mexico, with Repsol already having two discoveries: Polok and Chinwol, in the adjacent block to the north, known as Area 29, discovered in 2020. Repsol has renounced its rights to five other blocks to concentrate its efforts on Area 29, where it plans to drill up to three more wells. At Area 29, Repsol plans to operate a floating production, storage and offloading vessel.

According to the upstream regulator, the CNH, the FPSO is part of the infrastructure that can be shared. Zama, one of the most important discoveries in the country, is also in the area. Zama, operated by Pemex but discovered by Talos Energy, has been estimated to hold almost 700 million barrels of light crude, according to early estimates. The field is expected to yield as much as 150,000 b/d when it peaks and it will be one of the main private contributors to national production.

Eni's move to develop clusters is backed by the industry, which has been facing increased scrutiny and regulation.

The National Association of Hydrocarbon Companies, or AMEXHI, has noted that cooperation and sharing of infrastructure is one way to compensate for the lack of new auctions for additional blocks to continue the exploration of the resources identified in Mexico.

Upon taking office, President Andrés Manuel López Obrador cancelled the upstream auctions that his predecessor Enrique Peña Nieto started, which resulted in over 100 exploration and production contracts, many of which include Pemex.

According to the CNH, there are currently over 110 billion boe in prospective resources in Mexico, of which only 52 billion have been assigned for exploration, with Pemex holding 40 billion of those. The total crude production of Mexico since it began its oil industry around 1938 has been roughly 60 billion boe, according to CNH.