Where there is Still Oil in the Western Hemisphere

Alaska and Texas have been known for oil for quite some time, however there are other areas in foreign countries that have their own great deposits.

Through all of my previous energy articles, I believe I have painted a bleak picture for the energy available for current consumption. That was the point, as the term ’peak oil’ came into our nomenclature. Alaska and Texas have had oil produced for years. Wildcatting is still practiced and oil tycoons are still around. But, these domestic areas are running out. However, there are deposits that are known worldwide that exist, and will inevitability be tapped. One question is will be is how/if/when foreign governments will allow private companies and/or American companies to explore, develop and extract these deposits and reservoirs.
Mexico has a surprising amount of oil in and out of the 2/3 of the Gulf of Mexico it controls. Specifically, the Chicontepec Basin is a great, largely untapped oilfield located northeast of Mexico City in the states of Veracruz, Puebla and Hidalgo. Initially discovered in 1926, one constraint to its development is the type of oil that it contains. The extra heavy crude posed refining issues given the technology of the past 70 years. There is some 10 billion barrels of crude oil estimated in the basin.
While this area has a great amount of potential, only Mexico’s government has access to it. The national oil company Petróleos Mexicanos, colloquially known as PEMEX, controls all of Mexico’s oil production and development. The total assets of PEMEX is about US$415.75 Billion with US$102 billion being held by the public. No foreign company has operated on Mexico’s oil since 1938 and although the laws are slowly changing, one may question how reluctant foreign companies may be to come back. Making things more complicated is that the Mexican government takes about 60% of PEMEX’s profits. How soon will they give that up?
There are some governments that like America and some that don’t. Venezuela is one of those governments. President Hugo Chavez’s nation however, has an estimated 513 billion barrels of crude oil in the Orinoco Belt. This amazingly rich belt occupies the southern strip of the eastern Orinoco River Basin. Its name in Spanish is Faja Petrolífera del Orinoco (Orinoco Petroleum Belt). It covers part of the states of Guarico, Anzoategui, Monagas and Delta Amacuro.
This belt rivals the Athasbasca Basin in Alberta, Canada for the largest oil sands deposit in the world. Similar to Mexico’s PEMEX, Venezuela has a national oil company, Petróleos de Venezuela SA. Although the Venezuelan government claims it produces 2.96 million barrels per day, the U.S. estimates about 2.09 million barrels per day.

While American companies may have a difficult time entering the Venezuelan oil regions, agreements with the Italian company Eni and the Chinese company Sinopec to develop Orinoco. Turkish companies have expressed interest in developing the area. Moreover, Chevron (NYSE:CVX) has a 34% stake in a block of Orinoco.


The nation of Brazil is known for many things, from World Cup Champions, beautiful beaches, the Amazon River and spectacular rainforests. Yet,off-shore, Brazil offers two very oil fertile basins; Santos and Campos. Both exist in what is called pre-salt layer deposits and sit about two miles below the floor of the ocean. Estimates of the amount of oil range between 90 – 125 billion barrels.

The Santos Basin is about 190 miles south east of Sao Paulo and is about 136,010 square miles. Two existing oil fields have already been discovered, Tupi and Jupiter. Tupi was discovered in October of 2006 by BG Group. The BM-S-11 block which contains Tupi field is operated by Petrobras (NYSE:PBR) with controlling 65% of the stake while BG Group (OTC:BRGYY) holds a 25% and Portuguese Galp Energia (Euronext:GALP) holds 10% of the share. Jupiter has no large company ownership yet,but has the potential to rival the Tupi filed in size.

The Campos Basin has an area of about 38,610 square miles and has two major oil fields; Marlim and Albacora. Marlim currently produces about 500,000 barrels a day. Petrobras will legally operate all new exploration licenses in the pre-salt area, but the company plans to sell off rights to drill in portions of the region. In February 2010 a new 65 million barrel discovery was made by Petrobras on the Barracuda oil filed of the Campos Basin.

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