Category: Mexico

Reforms embraced by Mexican President Enrique Peña Nieto could transform regional energy landscape, experts told a House subcommittee. File Photo by UPI/Photo by Dennis Brack WASHINGTON, July 24 (UPI) — The opening up the Mexican energy sector under the Peña Nieto administration could bring profound changes to regional energy security, experts testified. A subcommittee on the Western Hemisphere in the House Foreign Affairs Committee heard testimony about the impacts of Mexican President Enrique Peña Nieto’s decision to open Mexico up to private investors after more than 70 years under a monopoly controlled by state-run Petroleos Mexicanos, or Pemex. "In hydrocarbons production, the completion of these reforms gives the United States, Canada and Mexico an opportunity to make North America a new foundation for global energy security," Carlos Pascual, a former U.S. ambassador to Mexico and senior vice president for consultant firm IHS, testified. The government recently auctioned off rights […]

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Pemex has given conflicting statements about how much output was cut. In an e-mailed response to questions on July 8, Pemex reiterated its 1.5 million-barrel estimate. In a follow-up e-mail on July 10, the company said Bloomberg’s 4.2 million-barrel calculation was also “in the order of Pemex’s estimates” and didn’t provide details to explain the difference when asked in additional messages. At the heart of the confusion appears to be what, exactly, Pemex means by lost output. The production isn’t “lost,” Pemex says, just “deferred.” “It seems like Pemex is using a word game to avoid calling production lost,” said George Baker, an oil analyst and publisher of Mexico Energy Intelligence. “If production is being deferred after an accident, then that means the infrastructure isn’t in place or in good enough condition to pump the oil, so wouldn’t that be the same thing as lost production?” It’s not the […]

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Busting When Everyone Else Is Booming Mexico is about to undergo its first subsea land rush. International energy producers that sat out Mexico’s historic oilfield auction this week will be among the fiercest competitors for potentially massive deepwater prospects that go up for sale as soon as next month, said Ivan Cima, Wood Mackenzie Ltd.’s head of Latin American upstream research. Unlike Wednesday’s government auction, which involved 14 close-to-shore fields holding at most a few hundred million barrels of crude each, the tranche of prospects Mexico is expected to offer in August includes more promising geologic structures, Cima said in an interview on Thursday. The blocks are near the line that divides U.S. and Mexican waters of the Gulf of Mexico and close to some of the most significant discoveries of the past 15 years on the U.S. side, Cima said. “Those are capital-intensive projects that are certainly geared […]

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Exxon Mobil Corp., Chevron Corp. and the French oil giant Total SA opted out of Mexico’s historic oil auction because the fields are too small. None of the 14 shallow-water prospects in the Gulf of Mexico holds more than 384 million barrels of crude, according to Mexico’s National Hydrocarbons Commission. That’s far short of the billion-barrel finds prized by major international oil producers, said Fadel Gheit, a New York-based senior analyst at Oppenheimer & Co. “Shallow water is the minor leagues and these companies want to play in the major leagues,” Gheit said on Wednesday. “Deepwater is where the major leagues are. The shallow waters have already been picked dry.” The U.S. and European explorers that abstained from the first round of bidding Wednesday also probably balked at some of the financial and contractual terms insisted upon by the Mexican government, Gheit said. Any terms that would have crimped […]

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Mexico’s first auction of offshore oil leases fell short of the country’s expectations as several majors decided not to participate and only two of 14 blocks received qualifying bids. Exxon Mobil Corp., Chevron Corp. and Total SA passed on the 14 shallow-water oil blocks auctioned by Mexico Wednesday in the country’s first-ever sale of territory in the Gulf of Mexico, 77 years after seizing energy assets. The 14 percent success rate was less than half the 30 percent to 50 percent goal that the government said would be its minimum for judging the auction a success. The auction was the first in a series that will help determine whether Mexico can reverse a decade-long decline in crude output and fulfill President Enrique Pena Nieto’s pledge to double the pace of economic expansion. The output drop and an almost 50 percent plunge in oil prices during the past year had […]

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Success of auction for permits for offshore Mexico may test oil sector reforms announced last year by Mexican President Enrique Peña Nieto. File Photo by Dennis Brack/Pool/UPI MEXICO CITY, July 14 (UPI) — Australian media reports Tuesday energy companies there are among the early victors in the first round of auctions for exploration permits offshore Mexico. Australia’s BHP Billiton and Woodside Petroleum each prequalified as bidders for the first round of auctions for permits to explore the shallow Mexican territorial waters of the Gulf of Mexico, the first in more than 70 years. Neither company offered a statement on the approval. Deutsche Bank energy analyst Paul Young told The Sydney Morning Herald deepwater permits, expected on the auction block next year, were among the "most promising and anticipated acreage" offers in the region. Mexican President Enrique Peña Nieto last year set a goal of producing 3.5 million barrels of […]

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MEXICO CITY—Former Mexican finance minister Pedro Aspe has an unusual collection on the walls of his offices here: stock and bond certificates from some of the Mexican oil companies that existed before the industry was nationalized in 1938, creating the monopoly Petróleos Mexicanos. The more than 170 such companies that existed at the time had names, such as Co. Lluvia de Oro, or Rain of Gold Co. “Many of these companies were subsidiaries of foreign capital, but there was a Mexican oil industry too. And that’s what we want to recreate,” said Mr. Aspe, a senior managing director of Evercore Partners Inc. and head of the U.S. investment-banking advisory firm’s Mexican unit. Now, as Mexico opens its oil industry to competition for the first time in nearly 80 years, Mr. Aspe is one of several Mexican businessmen who have financed or helped create homegrown oil companies . Mexico plans […]

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Mexico waited 77 years to invite foreign oil producers back into its borders. That was one year too many. The move to lure tens of billions of dollars from the likes of Exxon Mobil Corp. will be put to the test for the first time at an oilfield auction on Wednesday. With oil prices down by about half since last year, five of 38 potential bidders, including Glencore Plc, Noble Energy Inc. and even Mexico’s state-owned oil producer, have pulled out. President Enrique Pena Nieto moved to end the state monopoly after poor drilling infrastructure and technology failed to reverse a decade-long production decline that reduced government revenue. To lure investments now, Mexico will probably get a much smaller share of profits than it would have a year ago. “They shaped expectation at a $100-per-barrel market and we are way off that now,” Wilbur Matthews, chief executive officer of […]

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Mexico’s president Enrique Pena Nieto. Photographer: Susana Gonzalez/Bloomberg Mexico President Enrique Pena Nieto’s credibility on law and order was damaged this weekend by the prison escape of the nation’s most famous drug trafficker. Now he’s about to be tested on his pledge to attract private investment to the flagging oil business and help revive the economy. On Wednesday, the government will hold the first in a series of petroleum auctions that will help open the energy industry, bringing in an estimated $62.5 billion by 2018 and increasing annual output by 500,000 barrels a day. The exploration and production contracts, the first since then-President Lazaro Cardenas nationalized the fields in 1938, will end the monopoly of state-owned Petroleos Mexicanos, or Pemex. The success of the auctions also will determine whether Pena Nieto, 48, can reverse a decade-long decline in crude output and fulfill his pledge to double the pace of […]

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Pemex said Monday it has planned "additional volumes of gasoline imports in order to regularize supplies" in several states following what one analyst described as a "perfect storm" of shortages involving red tape and crime. The state company traditionally prides itself in ensuring supplies of all fuels to industry and consumers. But long lines have formed in recent weeks at the pumps of the service stations that still have gasoline on sale. The problems have arisen in at least half a dozen states, though not in Mexico City, with its population of 20 million. Pemex cited several factors for the shortages, including a new billing system that has failed to register the orders made by service stations for new supplies. Another reason, in the area around the northern industrial capital of Monterrey, is that the Cadereyta refinery there is undergoing major maintenance. And in northern border states as Coahuila, […]

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On June 22, Mexico’s Federal Electricity Commission (CFE) announced it would tender a new round of 24 energy infrastructure projects totaling $10 billion, including a $3 billion underwater pipeline bringing U.S. natural gas from Texas to Tuxpan, Veracruz. Amidst a grand national “gasification” strategy that has promoted Mexican imports of U.S. natural gas, this may be one of the most ambitious projects yet. Of course there are concerns around potential risks associated with the project – whether there is the local capacity to carry it out, and whether it’s really necessary – all of which must be resolved if the pipeline is to begin transporting the proposed 2.6 billion cubic feet of natural gas per day by 2018. As for financing and construction of the Texas–Tuxpan subsea pipeline there are several options. In the case of previous tenders, interest has come from well-established U.S. companies such as Sempra’s IEnova, […]

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MEXICO CITY—State-owned Petróleos Mexicanos is in advanced talks with Mexico’s powerful oil workers union to lower labor costs via a pension overhaul and for more flexible work rules to secure its future in a newly competitive environment, according to people familiar with the negotiations. Success in renegotiating the collective bargaining agreement at Mexico’s biggest company by sales and staff could determine how well Pemex performs now that oil prices are low and the former energy monopoly faces private-sector competition for the first time, analysts say. Moreover, the Mexican government has said it would assume a significant portion of Pemex’s $100 billion in unfunded pension liabilities if the current system is successfully changed. “If they finally agree on these changes, it would be the most important step Pemex can take to guarantee it remains a dominant and competitive player in the long run,” said Leo Zuckermann, political analyst at the […]

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The Mexican state oil company Pemex has announced one of its biggest discoveries in years, unveiling new shallow water oil fields in the southern Gulf of Mexico that it says could produce 200,000 barrels per day by mid-2018. The total proven, probable and possible reserves of the fields could be as high as 350m barrels of crude-oil equivalent, said Pemex’s chief executive officer, Emilio Lozoya. The new fields off the coast of Tabasco and Campeche states comprised three of light crude and one of heavy crude, and could start coming onstream in 16 months, Pemex said. “It’s a recent achievement and one of great magnitude,” Lozoya said. The fields would take around three years to reach their full 200,000 barrel per day capacity, said Jose Antonio Escalera, director of exploration for Pemex. Pemex described the finds as its biggest exploration success in the last five years after the discoveries […]

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The historic end of Mexico’s state monopoly on energy could spark more integration with U.S. power utilities than the much hyped opening of the country’s oil industry, U.S. Energy Secretary Ernest Moniz said. The focus of Mexico’s energy overhaul “is typically on the hydrocarbons but in fact the most consequential part for further energy integration may very well be electricity,” Moniz said in an interview during the Clean Energy Ministerial conference in Merida, Mexico, on Wednesday. “American companies will clearly be coming in, and we will also see Mexican companies in the U.S.” Mexico ended the monopolies to allow foreign energy companies to operate in the country for the first time in more than seven decades. The move will enable further integration with U.S. utilities and natural gas pipelines across the border, much like links between the U.S. and Canadian gas and electricity markets, Moniz said. “Presumably we will […]

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MEXICO CITY—National oil company Petróleos Mexicanos suffered a short-term drop in oil production from an April accident at a Gulf of Mexico processing platform, but is ramping output back up and expects to meet its 2015 goal of 2.29 million barrels of oil a day on average, a company official said. Exploration and production chief Gustavo Hernández said on a conference call Thursday that the April 1 accident at the Abkatun oil and gas processing complex in the southern Gulf shut in some production, as did a series of storms in early January, but Pemex expects to pick up the pace in coming months. Four workers died in the explosion and fire at the Abkatun platform, and three workers are still missing, Mr. Hernández said. So far this year, Pemex has averaged crude-oil production of about 2.27 million barrels a day, with the most recent April 1-26 period just […]

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MEXICO CITY—It has been eight months since national oil firm Petróleos Mexicanos applied for a permit to buy U.S. light oil in a swap for Mexico’s heavier blend, but the company says it is confident it will get U.S. Commerce Department approval and isn’t looking to alternative sellers, a senior Pemex official said. “The signs are positive,” said José Manuel Carrera, head of Pemex’s commercial arm PMI. “We continue to be respectful, but always very insistent that this happens as soon as possible,” he said in an interview last week. The U.S. maintains a ban on crude-oil exports dating back to the 1970s, but swaps are allowed when exports are balanced by additional imports. And while both the U.S. and Canada allow swaps, the subject is politically sensitive given how dependent the U.S. has been on massive oil imports in the recent past. There is little precedent to measure […]

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HOUSTON, Apr. 23 OGJ Staff Writer Chief executives of Mexico’s Petroleos Mexicanos (Pemex) and Argentina’s YPF SA are both seeing energy reforms within their respective countries, and both emphasize the need for investment from international oil and gas companies to achieve their new goals. “Pemex is transforming itself from a government organization to an enterprise” and is tasked with the new challenge and luxury of financial autonomy, explained Emilio Lozoya Austin, the company’s chief executive officer, at IHS CERAWeek on Apr. 21 in Houston. Four new agencies and five new spinoff companies have been created in Mexico over the past year, including transportation and services companies that will serve international participants following their entrance into the country ( OGJ Online, Aug. 21, 2014 ). Over the next year, the biggest steps forward will come through partnerships created with international companies in the Round One bid round and ensuring contracts […]

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Oil production at Pemex has touched bottom after a decade of decline, according to the head of exploration and production at Mexico’s state-controlled energy group, and a new era of deals with private companies should fuel its recovery. “Things are looking good,” Gustavo Hernández told the Financial Times in an interview, just weeks before the first contracts with private operators are due to be unveiled on May 13. The statement may sound rash — output at what has been Mexico’s sole hydrocarbons producer for nearly 80 years has been sinking inexorably since 2004, when the giant shallow-water Cantarell field was at its height, and the company has already cut its 2015 production forecast once this year. Furthermore, Pemex, the main contributor to the federal budget, is shouldering the brunt of public sector cuts in a government austerity drive as it seeks savings of some $4bn this year. The latest […]

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MEXICO CITY—An expected wave of international geological firms set to scan Mexico’s oil patch for oil and gas reserves will give the country a clearer picture of its riches, the nation’s top energy regulator said Monday in an interview. In the wake of Mexico opening its energy sector to foreign companies, the National Hydrocarbons Commission has about two dozen companies requesting permission to conduct surface exploration , such as seismic studies that can reveal oil and gas deposits below the ocean floor or in onshore areas. Those companies can use newer technologies and provide a greater number of scans that Mexico has used in the past, giving a clearer picture of the potential reserves. Some of those firms are expected to be cleared for exploration in coming weeks, in addition to four Norwegian companies that were cleared last week to cover nearly one-million square kilometers in the Gulf of […]

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MEXICO CITY (Reuters) – At least four people died after a fire broke out on an oil processing platform in the Gulf of Mexico early on Wednesday, leading to the evacuation of 302 workers, Mexican state-run oil company Pemex said. The fire, which burned throughout the day, erupted overnight on the Abkatun Permanente platform in the oil-rich Bay of Campeche. Forty-five people were treated for injuries and 16 of them were hospitalized, two with serious injuries, Pemex said. Eight firefighting boats were brought in to battle the flames, Pemex said, noting that one of the fatalities was from the state-run giant and another was a contractor for Mexican oil services firm Cotemar. Two others have yet to be identified. Videos posted on Twitter showed the offshore platform engulfed in flames, lighting up the night sky, as rescue workers looked on from nearby ships. The fire broke out in the […]

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(Bloomberg) — Mexico’s National Hydrocarbons Commission lowered the country’s estimates for proven oil reserves and state-run Petroleos Mexicanos cut its 2015 production forecast after crude prices collapsed and its budget was reduced. Pemex cut its 2015 output forecast by more than 100,000 barrels to 2.288 millon barrels a day, Gustavo Hernandez, exploration and production director, said Thursday at a builders congress in Mexico City. Mexico’s proven oil reserves slid 3.1 percent to 13.02 billion barrels from a year earlier, Hydrocarbons Commissioner Juan Carlos Zepeda said Thursday in an interview at Bloomberg’s Mexico City offices. Pemex’s failure to boost reserves and drilling activity shows that opening the oil industry to outsiders is needed, Zepeda said. Mexico is opening its energy industry to foreign producers for the first time since 1938. Pemex drilled 120 wells in the fourth quarter, 36 percent less than a year earlier. “These numbers are distant from […]

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MEXICO CITY, March 12 (Reuters) – Mexican state-owned oil company Pemex plans to take part in the first two public tenders of the so-called Round One opening of the country’s oil and gas industry, a senior executive said on Thursday. Mexico has already announced terms and conditions for the first phase of the sector opening, which follows a reform finalized last year that ended Pemex’s 75-year-old oil and gas monopoly in a bid to attract more private investment. Gustavo Hernandez, Pemex’s head of exploration and production, said the firm would take part in the "first two tenders" – one for 14 production and exploration areas and the second for five contracts spread over nine production fields. "A lot of companies have approached Pemex because we have knowledge of the shallow water basin with more than 40 years of exploration and 35 years of production," Hernandez told reporters after an […]

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Pemex Exploracion y Produccion can’t recover hundreds of millions of dollars lost on Mexican condensate smuggled across the Texas border by bandits and sold to Shell Chemical LP, ConocoPhillips Co., Continue Reading

(Bloomberg) — Petroleos Mexicanos is negotiating reduced rig rates with all of its providers after the state-owned oil producer posted a ninth straight quarterly loss on slumping crude prices. Pemex is in talks with oil service and jack-up rig providers to reduce daily rates after the board approved cutting more than $4 billion from its 2015 budget last week. The Mexico City-based company will seek cuts that will probably be less than the 35 percent to 40 percent reductions recommended by consulting firm IHS Inc., said Pemex’s exploration and production director. “We have talked with service companies and agreed that actions need to be taken in order to reduce the effect of the impact of the oil price reductions,” E&P Head Gustavo Hernandez said Friday on an earnings conference call. Pemex is analyzing a series of actions to reduce spending after reporting a quarterly net loss of $7.75 billion […]

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(Bloomberg) — The Mexican government will cut 2015 spending by 0.7 percent of gross domestic product on the expectation that oil prices may remain low for years, Finance Minister Luis Videgaray said. Stocks extended declines. President Enrique Pena Nieto’s administration will reduce spending by 124.3 billion pesos ($8.3 billion) this year from the level approved by lawmakers in November, Videgaray said at news conference in Mexico City. The government is canceling plans for a passenger train in the Yucatan peninsula and suspending a high-speed rail project meant to connect Mexico City and Queretaro, Videgaray said. The reductions will allow Mexico to avoid raising additional debt or increasing taxes, Videgaray said. Mexico’s state-owned oil and electricity companies will cut their own outlays, and all the reductions will have a marginal effect on 2015 growth, Videgaray said. “We will take measures not only addressing the current situation, but rather we’ll take […]

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BIG TARGET: A Pemex petrochemicals plant in the city of Coatzacoalcos. Pemex provides a third of all Mexican government revenue – but is vulnerable to fraud and waste. Reuters identified $11.7 billion in Pemex contracts flagged as problematic by government auditors. But records show that authorities rarely act on those warnings. REUTERS/Oscar Martinez Mexican authorities have disregarded auditors’ warnings on billions of dollars of deals granted by the state oil giant, a Reuters examination shows. Among the businessmen who benefited: an alleged associate of the Zetas cartel. MEXICO CITY – The state-owned petroleum giant Pemex paid $9 million in 2011 to have an oil rig towed halfway round the world, from the United Arab Emirates to the Gulf of Mexico. When government auditors looked at the contract, they turned up some problems. The rig had the wrong equipment for the assignment, according to a report by Mexican congressional auditors. […]

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Petroleos Mexicanos is in talks with the U.S. Department of Commerce to import 100,000 barrels a day of light crude to increase gasoline production and improve refining by Mexico ’s state-owned oil producer. Pemex, as the world’s ninth-largest oil producer is known, would mix the imports with its heavy oil, the Mexico City-based company said today in an e-mailed statement. Negotiations with the U.S. about the proposal, which was presented last year, are continuing, Pemex said. Some companies have called for the U.S. to end its 40-year prohibition on oil exports, saying booming domestic output reduces the need to keep supplies at home. U.S. oil production has increased by 66 percent in the past five years, and a majority of that growth is in light oil from shale rock. The U.S. bans most exports of unrefined crude, with exceptions such as shipments to Canada. The U.S. exported a record […]

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MEXICO CITY—Mexican state-run oil giant Petroleos Mexicanos said Thursday it has requested permission from the U.S. Commerce Department to import light crude to Mexico from the U.S., with the aim of improving output at its Mexican refineries. The significant increase of light crude production in the U.S. presents an opportunity to mix that oil with Mexican heavy crude, and thus boost refining efficiency in Mexico, the company known as Pemex said. Pemex anticipates that it could import up to 100,000 barrels a day of light crude and condensates under the proposal, which it calls a “swap.” America has a long-standing ban on exporting crude-oil pumped in the U.S., but the Commerce Department recently issued new rules clarifying that some ultralight oil can freely flow out of the country to foreign buyers. Dubbed condensate by the energy industry, this light oil no longer needs to be fully processed at a […]

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The 40-year old ban on most U.S. crude exports is set to be loosened after Mexico’s state-owned oil company asked for an exception. Petroleos Mexicanos is in talks with the U.S. Commerce Department to import 100,000 barrels a day of light crude to increase Mexico’s gasoline production and improve refining. Pemex, as the world’s ninth-largest oil producer is known, would send its heavy oil to U.S. Gulf Coast refineries in exchange. Oil producers including Exxon Mobil Corp. (XOM) and Continental Resources Inc. (CLR) have called for the U.S. to end the restrictions, saying booming domestic output reduces the need to keep supplies at home. U.S. oil supply has increased by 66 percent in the past five years, and a majority of that growth is in light oil from shale rock. It would be another incremental allowed export “that will help relieve the pressure on pricing of domestic light oil, […]

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The Mexican government’s surprise decision to strip state-owned oil producer Petroleos Mexicanos of $3.4 billion is raising alarms for bondholders LM Capital Group LLC and Investment Placement Group. The Finance Ministry said Dec. 26 that it took the money, reducing cash holdings at the company known as Pemex to a 12-year low of 48 billion pesos ($3.3 billion). Returns on Pemex’s benchmark bonds due 2022 beat the emerging-market average last year, delivering 6.6 percent to investors on speculation that the country’s effort to lure private investment to the energy industry will reduce the company’s tax burden. To LM Capital and Investment Placement Group, the move is a cash grab by the government to offset a drop in revenue from the company amid a plunge in oil prices and the 10th straight year of declining output. During the first 11 months of 2014, taxes paid by Mexico City-based Pemex declined […]

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Production-sharing contracts for shallow-water exploratory blocks in Mexico will be granted for 25 years, Deputy Energy Minister Lourdes Melgar said. The 14 contracts will each have two renewal options of five years, Melgar said today in Mexico City. Terms for other development blocks will be announced in January, she said. The terms come a day after Mexico authorized bidding guidelines for new offshore blocks as the country prepares for investment in its newly opened energy industry. Before crude slumped below $60 a barrel for the first time in five years, Mexico had forecast private investment would bring in more than $50 billion by 2018. Mexico’s oil monopoly, held by state-owned Petroleos Mexicanos since 1938, ended last year after President Enrique Pena Nieto approved a bill to allow foreign producers to drill. Companies will pay 30 percent income tax on the shallow water blocks, Deputy Finance Minister Miguel Messmacher said […]

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Gas is flared from a tower on an oil drilling rig operated by Petróleos Mexicanos… ENLARGE Gas is flared from a tower on an oil drilling rig operated by Petróleos Mexicanos in the Gulf of Mexico. Bloomberg News MEXICO CITY—The recent plunge in oil prices is prompting Mexico’s government to consider scaling back the initial bidding for its momentous plans to reopen its oil and gas industry to private companies, and to offer them better terms. The government is now likely to delay or scale-down tenders for some of the oil fields and areas that it planned to offer in the coming months, especially in areas with shale oil where recovery costs are higher than in traditional oil fields, Energy minister Pedro Joaquín Coldwell said late on Thursday. He said the auctions for deep-water fields were unlikely to change because they were longer-term investments, but that other fields with […]

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Analysis Two years into Mexican President Enrique Pena Nieto’s six-year term, the premier has managed to pass contentious energy reform legislation that will allow foreign energy firms to operate independently inside the country. The government will award the first of these contracts in the opening half of 2015, marking the start of an ambitious effort to revitalize Mexico’s lagging energy sector. For foreign energy companies, 2015 will be an introduction to Mexico’s complex security environment and to its shifting constellation of transnational criminal groups, commonly referred to as cartels. Mexico’s state-owned energy company, Petroleos Mexicanos, or Pemex, and its various contractors are already keenly aware of the risks these groups pose. These risks have intensified in recent years as organized crime groups have sought to diversify their operations beyond drug trafficking, expanding into fuel theft. Crime groups have the capacity to organize hydrocarbon theft on a massive scale across […]

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MEXICO CITY— Royal Dutch Shell PLC has some natural advantages as it looks at Mexico’s opening to foreign oil firms in exploration and production, including a 20-year partnership at a Houston oil refinery with national oil firm Petróleos Mexicanos and decades of experience producing oil and gas on the U.S. side of the Gulf of Mexico, the company’s Upstream Americas Director Marvin Odum said on Thursday. Shell operates oil fields in the deep waters of the Perdido Fold area on the U.S. side of the Gulf, not far from an area on the Mexican side of the waterway where Pemex, as Mexico’s national oil company is known, has found significant resources and is looking for partners. “We basically built, developed and operate the Perdido development,” said Mr. Odum. “That, potentially, is an advantage in these circumstances. We bring not only a broad set of skills but a very specific […]

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MEXICO CITY—Mexico’s national oil company Petróleos Mexicanos, or Pemex, announced a $4.6 billion reconfiguration of its Tula refinery on Wednesday, saying the project was a better deal than moving forward on a new refinery nearby that had a price tag of at least $10 billion when it was proposed in 2008. Pemex CEO Emilio Lozoya said the Tula upgrades are part of a $20 billion package of refinery projects that include reconfigurations of the Salamanca and Salina Cruz refineries and previously announced work to upgrade all of the firm’s six refineries to produce cleaner diesel. The Tula project will increase gasoline and diesel production at the refinery to 300,000 barrels a day from the current 160,000 barrels, Pemex said in a statement. Separately, construction firm Empresas ICA said its ICA Flour joint-venture had signed a $1.3 billion contract to build a coker plant at the Tula refinery as part […]

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By Anthony Harrup MEXICO CITY–Mexico’s peso fell Friday to its weakest level against the U.S. dollar in more than two years as the continuing decline in world oil prices pressured commodity-dependent currencies. As the most traded of the emerging-market currencies, the peso is often used by investors to hedge emerging market exposure and sold off in times of global financial turmoil. Already under pressure along with other emerging market currencies on prospects of higher U.S. interest rates, the Mexican currency lost further ground after the Organization of the Petroleum Exporting Countries decided against cutting crude oil output to address falling prices. The Mexican currency weakened as far as 13.96 to the dollar during Friday’s session before settling back to 13.9080, its weakest close since mid-2012. The drop in oil prices, and the lack of liquidity because of the U.S. Thanksgiving holiday, were pressuring the exchange rate, local currency traders […]

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Mexico City (Platts)–10Nov2014/402 pm EST/2102 GMT A plan by Mexican state-owned Pemex to build a $6-billion natural gas liquefaction plant at Salina Cruz on the country’s Pacific Coast has been met with skepticism by analysts. The aim of the project is to cash in on the wide differentials in natural gas prices between Asia and North America. Speaking at a conference in Houston, Alejandro Martinez, director-general of the Pemex Gas subsidiary, said that the gas would be transported by a planned natural gas pipeline linking Pajaritos on the Gulf of Mexico and Salina Cruz on the Pacific Coast, a distance of some 120 miles. "The aim is to take advantage of our country’s geographical location and the business opportunities offered by the market conditions," Martinez said last week in a Houston presentation to potential project investors. "The natural gas that we produce in the Gulf of Mexico can be […]

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Home | News & Analysis | Latest News Headlines | US to exchange crude with Mexico as exports climb to 1 million b/d: Citi Washington (Platts)–7Nov2014/508 pm EST/2208 GMT The US is expected to export more than 1 million barrels a day of crude oil and condensates by early next year, including roughly 200,000 b/d in light-for-heavy crude exchanges with Mexico, analysts with Citi said in a new report. According to Citi’s estimates, US crude oil exports to Eastern Canada will grow 500,000 b/d, exports from Alaska will climb to 100,000 b/d, exports of processed condensate will hit 200,000 b/d and exports to Mexico will grow to 200,000 b/d from zero. Those Mexican exports will likely be done, at least initially, under exchanges in which the US Commerce Department allows a barrel-for-barrel trade of light crude exports for heavy crude imports, analysts said. "In the case of Mexico, there […]

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LA MURALLA IV, Gulf of Mexico — The computer screens lining the bubblelike control room on this giant floating platform monitor pressure levels in a narrow shaft cut through bedrock to a reservoir of valuable natural gas three miles below sea level. For six months, an international team hired by a contractor for Petróleos Mexicanos, Mexico’s state-owned oil monopoly, has been drilling an exploratory well here. Now, the work is nearly done. Drill pipes are stacked like sentries. An underwater robot has been pulled back up from the deep seafloor. A wireline sensor is gathering data to determine how much oil and gas lie below. An operation like this would attract little attention in the northern part of the gulf, where dozens of deepwater platforms are part of the mosaic fueling America’s energy boom. On the Mexican side, though, the search is just beginning . Pemex is counting on […]

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MEXICO CITY, Oct 24 (Reuters) – Mexico’s state-owned oil company Pemex reported a sharply deeper third quarter loss on falling crude output and prices, the company said on Friday in a filing with the Mexican stock exchange. Pemex said its quarterly loss totaled 59.65 billion pesos ($4.44 billion) during the July to September period, compared with a year earlier loss of 39.14 billion pesos ($2.98 billion). The company reported third-quarter revenues of 406.5 billion pesos for the quarter, down 0.7 percent compared with same period last year. Higher interest payments and foreign exchange losses also weighed. Pemex’s crude oil production was down 4.3 percent during the quarter to 2.398 million barrels per day (bpd), compared with 2.506 million bpd during the third quarter of 2013. Meanwhile, the average price of Pemex’s crude exports fell 8.4 percent to $92.08 per barrel, compared with $100.53 per barrel during the same period […]

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When Mexico’s energy overhaul was signed into law in August, Emilio Lozoya, the chief executive of Petróleos Mexicanos, set a goal for the state oil giant that until recently would Continue Reading

Print Back to story Petroleos Mexicanos, Mexico ’s state-run oil producer, is optimistic of a crude discovery at the Vasto-1 ultra-deep water exploratory well by year-end, said Exploration and Production Director Gustavo Hernandez. Pemex, as the Mexico City-based producer is known, has found “evidence of hydrocarbon content” at the Vasto-1 well and hopes to announce an ultra-deep water find by year-end, Hernandez said today in a phone interview from Mexico City. If confirmed the discovery would be the latest in the Perdido area, where the company estimates that as much as 10 billion barrels of potential reserves can be pumped. “We are working on the well and if it turns out to be as satisfactory as we hoped, I think we will be making another announcement in the near future,” Hernandez said of the Vasto-1 well. “It has shown good results that are going to allow us to determine […]

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Exxon Mobil Chairman Rex Tillerson signs memorandum of understanding with Mexican oil company Pemex. UPI/Kevin Dietsch MEXICO CITY, Oct. 3 (UPI) — The Mexican energy company known as Pemex said its agreement with Exxon Mobil is part of an effort to attract private capital to the national landscape. Emilio Lozoya Austion, director general of Petróleos Mexicanos, hosted Exxon Mobil President Rex Tillerson for the signing of a memorandum of understanding in upstream and downstream sectors of the Mexican energy sector . "The signing of the memorandum adds to the efforts Pemex has done to attract new technologies, capital and partners to allow them to compete effectively in the new Mexican oil market, ensure production and create jobs in the domestic energy sector," the Mexican company said in a Thursday statement. Mexican lawmakers embraced plans by President Enrique Peña Nieto to draw international energy companies into the nation’s energy sector […]

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Bloomberg Photo Service ‘Best of the Week’: Workers prepare drilling pipe on the Petroleos Mexicanos (Pemex) La Muralla IV deep sea crude oil platform in the waters off Veracruz, Mexico, on Friday, Aug. 30, 2013. Gulf of Mexico crudes strengthened on concern that the conflict in Syria might spread and threaten imports from the Middle East. Photographer: Susana Gonzalez/Bloomberg Mexico’s oil hedging programme – a highly secretive deal that is the largest single trade in crude markets – appears to be unfolding in public for the first time, according to traders. The public disclosure of a large options trade on a new database has led to speculation that the country’s government has locked in a price for most of its oil exports next year. More On this topic IN Commodities Put options locking in the sale of 5m barrels of crude for at least $80 per barrel were this […]

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MEXICO CITY, Sept. 12 (UPI) — Mexico relies on imports from its North American counterparts for some of its energy needs. Last year, the United States exported 658 trillion cubic feet of natural gas to the Mexican market, a 6 percent increase from the previous year. State-owned Petroleos Mexicanos, known also as Pemex, said it’s spending $2.5 billion to upgrade domestic refineries to produce more diesel and gasoline. The effort could cut back on Mexico’s imports from the United States and eventually lead to fuel exports . Lawmakers in Mexico are putting the final touches on plans embraced by President Enrique Peña Nieto aimed at drawing international energy companies into the nation’s energy sector. The move opens Mexico up to private investors after more than 70 years under a monopoly controlled by Pemex. The country’s energy sector accounted for more than 10 percent of export earnings last year. The […]

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MEXICO CITY—State-owned oil firm Petróleos Mexicanos said Friday that it is raising its 2015 goal for crude-oil output to 2.4 million barrels a day. The outlook comes after Pemex was forced last week to reduce this year’s production figures to account for water and other impurities pumped from offshore fields that were erroneously counted as oil. "We are looking at an upward tendency for 2015," said the company’s director of exploration and production, Gustavo Hernández, at a news conference. Pemex, as the company is known, lowered its estimated production for this year to 2.35 million barrels a day from 2.44 million to account for measuring errors at its offshore fields. Equipment at three production areas wasn’t accurately detecting the amount of water and impurities that are a common byproduct of oil production, particularly offshore, Pemex said. Mr. Hernández said its 2015 estimate for next year is for crude that […]

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Petroleos Mexicanos is preparing a request for the reimbursement of taxes the state-owned oil company paid on barrels it never produced. Pemex, whose taxes provide Mexico’s government with about a third of its budget, may seek the refund after over-reporting crude output for the first seven months of the year, according to investor relations head Rolando Galindo. Negotiations with the Finance Ministry could be lengthy and might not result in a reimbursement, he said in a telephone interview yesterday. The Mexico City-based producer last week reduced its year-to-date production through July to 2.34 million barrels a day from a previously reported 2.47 million, attributing the difference to water levels and measurement inaccuracies. Earlier yesterday, a person with direct knowledge of the matter said Pemex plans to ask for the reimbursement and is in the process of calculating how much it overpaid. The person asked not to be named because […]

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Source: U.S. Energy Information Administration, International Energy Outlook 2014 preliminary projections On August 11, Mexico’s president signed into law legislation that will open its oil and natural gas markets to foreign direct investment, effectively ending the 75-year-old monopoly of state-owned Petróleos Mexicanos (Pemex). These laws, which follow previously adopted changes in Mexico’s constitution to eliminate provisions that prohibited direct foreign investment in that nation’s oil and natural gas sector, are likely to have major implications for the future of Mexico’s oil production profile. As a result of the developments in Mexico over the past year, EIA has revised its expectations for long-term growth in Mexico’s oil production. Although there are many complexities to the new reform and many details that still must be settled before the reforms can take effect, reform is expected to improve the long-term outlook for growth in Mexico’s petroleum and other liquids production. Analysis in […]

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