* Pemex eyes $377 million crude treatment plant
* Traders say Maya crude quality has become less reliable
* Expanded treatment capacity could help slow oil decline
By Robert Campbell
MEXICO CITY, Feb 18 Mexico's state oil company
Pemex is mulling a $377 million upgrade of crude oil treatment
facilities to fix quality problems in its main export blend,
people familiar with the plan said on Thursday.
The project, which has not yet been released for tender,
envisions the construction of new equipment at the Dos Bocas
oil terminal that would cut the water and salt content in Maya
crude oil, said one of the people who had seen a Pemex
[PEMX.UL] presentation on the project.
Crude oil traders say fluctuations in the quality of Maya
crude oil have become more common with cargoes coming in
heavier than expected or with high water content, making it
harder to refine.
"It is something that has come up from time to time that we
think is linked to natural field decline," said a Maya buyer.
Pemex did not immediately return a request for comment.
No cargoes of Mexican crude oil have been rejected by
buyers due to quality problems, traders say, but refiners are
anxious to see the issue resolved.
Improving crude treatment facilities could also assist
Pemex in stemming the slide in oil production that has slashed
its output by nearly a quarter since 2004 to less than 2.6
million barrels per day, threatening the country's status as a
major oil exporter.
The culprit behind the dropping output is the giant
Cantarell oil field. Cantarell, which produced more than 2
million bpd in 2004, pumped only 599,000 bpd in December, as
its oil layer shrank, allowing water and natural gas to seep
into Pemex's wells.
As the amount of water produced at Cantarell exceeds
Pemex's processing capacity, wells must be shut down, speeding
up the decline of the field.
Adding crude oil dehydration capacity could allow Pemex to
leave some wells open for longer, which could help to slow the
rate of decline at Cantarell and help prop up Mexican oil
exports, which pay for more than a third of the federal
Pemex would like to have the project completed by the end
of 2011, which means it will have to tender the project this
year, sources said.
"It's a bigger version of the crude dehydration project
that was constructed at Dos Bocas last year," said the person
who declined to be named as his company is seeking business
A joint venture of Fluor Corp (FLR.N) and Mexican
engineering group ICA (ICA.MX) was awarded a $45 million
contract in 2008 to construct a crude oil dehydration system at
The new facility being considered would probably have
considerably more capacity, possibly as much as 100,000 bpd of
produced water, said the person whose company is seeking
business with Pemex.
(Reporting by Robert Campbell; Editing by Marguerita Choy)