Letter from South America: Mexico plays catch-up

The country’s upstream strategy seems at odds with reality and will require an about-turn if there is any hope of meeting its production targets

Mexico is having an existential moment as an oil-producing nation. In 2018, President Andres Lopez Obrador announced an ambitious goal to boost oil production to 2.4mn bl/d and gas output to 6.6bn ft³/d (187mn m³/d) by 2024. This led to the identification of around 20 small and medium-size “priority fields” operated by NOC Pemex to help inject additional supply. But this campaign has suffered setbacks, with field development plans running behind schedule and volumes not deemed large enough to sustain output for long. Mexico’s oil production has continued to decline over the past six years, dropping from 2.52mn bl/d in 2013 to 1.68mn bl/d in 2019. And the country has only maintained similar l