Area 1 Offshore Development, Gulf of Mexico

Italian oil and gas giant Eni, through its wholly-owned subsidiary Eni Mexico, is undertaking the development of three major shallow-water oil discoveries under the Area 1 offshore development in Gulf of Mexico, approximately 200km off the west coast of Ciudad del Carmen, Mexico.

Located in 33m water depth in the Campeche Bay of Gulf of Mexico, the Amoca, Mizton and Tecoalli oil fields are estimated to hold 2.1 billion barrels of oil-equivalent in place, containing 90% oil and 10% gas.

The National Hydrocarbon Commission of Mexico (Comisión Nacional de Hidrocarburos) approved the Area-1 development project in August 2018.

Eni plans to take the final investment decision (FID) on the project by the end of 2018 and start initial production in 2019.

The $1.9bn Area 1 development project is expected to achieve its full production capacity of 90,000 barrels of oil per day (bod), in 2021.

Area 1 offshore development rights and exploration drilling

Eni was awarded the production-sharing contract for the Area 1 offshore development by Mexico’s oil regulator in September 2015 as part of the second phase auction of the Round One tender initiated in July 2015.

Covering an area of 1,146km² on the southern edge of the Gulf of Mexico, the Area 1 exploration and production block included the Amoca, Mizton and Tecoalli oil discoveries, which were estimated to contain 196 million barrels of oil resources.

Eni appraised the three fields with Amoca-2, Mizton-2 and Tecoalli-2 appraisal wells in 2017 and increased the oil resource estimate for the development block to 2.1 billion barrels of oil equivalent.

In March 2017, Amaco-2, the first appraisal well, was drilled up to a depth of 3,500m and encountered a net oil pay of 110m in the Pliocene reservoir.

The Mizton-2 appraisal well was drilled up to a depth of 3,430m in September 2017 and encountered 185m of net oil pay in the Orca formation as well as a 280m-thick individual oil column.

The drilling of Tecoalli-2 appraisal well completed in December 2017 further confirmed the reservoir productivity of the Orca formation and led to the revision of the total oil in place estimate at Area 1 to two billion barrels of oil equivalent.

Area-1 offshore development details

The first phase development of the Area 1 project will involve the construction of a well-head platform on the Mizton field, from where the oil will be sent onshore for treatment via a 10in-diameter multi-phase line connecting to an existing facility owned and operated by Mexico’s state-run oil and gas company Pemex.

The production capacity in the first phase development will be 8,000bod.

The Area-1 will be further developed to attain its full production capacity with two additional platforms on Amoca and Tecoalli oil fields, and a floating production, storage and offloading facilities (FPSO) by 2020.

The FSPO will be capable of treating 90,000 barrels of oil and 75 million cubic feet of gas a day.

The water injection capacity and the oil storage capacity of the FSPO will be 120,000 barrels and 900,000 barrels, respectively.

Contractors involved with the Area-1 offshore project

MODEC was awarded a letter of intent by Eni in October 2018 for the supply, charter and operation of the FPSO for the Area 1 development project.

The scope of the contract includes engineering, procurement, construction, and installation of the FSPO.

The charter period for the FPSO will be 15 years, which can be extended up to 20 years.