* Mexico to drill 20-25 shale gas wells in 2013
* North American natural gas prices rising
By David Alire Garcia and Adriana Barrera
MEXICO CITY, Oct 1 Mexico's massive shale gas
deposits could be profitably extracted if North American natural
gas prices continue rising toward $4 per million cubic feet, an
official with state oil monopoly Pemex said on Monday.
The country boasts the world's fourth-largest reserves of
shale gas in deposits that may contain rich pockets of both
natural gas and oil, according to the U.S. Energy Information
Jose Antonio Escalera, deputy director of exploration at
Pemex Exploration and Production (PEP), said the company could
turn a profit with prices "in the order of between $3 and $4"
per million cubic feet and that it plans to drill 20 to 25
liquid shale gas wells in 2013.
U.S. natural gas prices closed on Monday at $3.47 per
million cubic feet. They are down more than 74 percent since
2008 largely due to dramatically increased supplies, but they've
recently been rising, climbing from $1.90 in April.
"We see the potential," Escalera said at a conference on
shale gas, which is trapped in rocks and requires expensive
technology called hydraulic fracturing, or fracking, to unleash.
Escalera added that Pemex would this year begin drilling at
least two additional wells to prove the existence of more
profitable shale oil.
He said that PEP has already drilled four shale gas wells in
the country's Burro-Picachos field, an extension of the Eagle
Ford shale formation near the U.S.-Mexico border, plus two
Once test wells are drilled and data collected, Escalera
said he expects each well to cost $5 million to $8 million.
The EIA estimates Mexico, the world's No. 7 oil producer,
has up to 680 trillion cubic feet (tcf) of natural gas.
Earlier on Monday, Mexico's deputy energy secretary Mario
Gabriel Budebo said the country's current shale gas deposits
stand at a more conservative 297 tcf.
A shale gas boom has been turning the United States into a