August 11, 2014
08/06/14 Dallas Morning News
Mexico’s plan to radically expand its energy sector passed its final legislative hurdle Wednesday, leaving behind 76 years of state monopoly for an uncertain future driven by competition.
The Mexican Senate voted 90-27 to pass the so-called secondary rules outlining the framework under which foreign companies will drill for oil and natural gas in Mexico. A cornerstone of President Enrique Peña Nieto’s ambitious economic overhaul, the law is expected to open the door to what some believe could be more than $1 trillion in investment and create a new energy paradigm for North America.
July 2, 2014
The first big set of contracts for oil and gas development in Mexico are likely to be delayed a few months, an energy ministry official said on Tuesday, after disagreements in Congress over detailed legislation to underpin them.
Congress is currently discussing so-called secondary laws, including some new rules and amendments to existing ones, needed to set in motion a landmark energy reform passed in December to open up the oil and gas industry to private capital.
June 9, 2014
06/07/14 The Brownsville Herald
Anyone who pays the slightest attention to the oil and gas industry knows that Texas is in the middle of a major energy boom, one concentrated largely on the vast Eagle Ford Shale formation that spans several counties in South Texas.
The same formation happens to extend south across the border into Mexico, where it’s known as the Burgos Basin. While Eagle Ford already has thousands of exploration sites in operation, virtually nothing is happening south of the border — nothing yet, at least. The Mexican government late last year instituted sweeping reforms on several fronts, including energy. The result is that, for the first time, companies other than PEMEX will be able to invest in energy exploration and production in Mexico.
June 3, 2014
Financial Post, 06/03/14
While the United States takes an aggressive stand against fossil fuels, its neighbours to the south and north are working together to boost oil and gas production.
A high-level delegation from Mexico was in Calgary Monday to invite Canadian companies to take advantage of its sweeping energy reforms.
Endowed with massive oil and gas resources, the two countries have made their development central to their economies, while taking the view that growth and environmental protection can move hand-in-hand, not at each other’s expense.
April 18, 2014
In the next two weeks, Mexico’s lawmakers are expected to release a series of laws, known as the secondary laws, that should begin to delineate how the revolutionary energy reforms approved last December will be implemented.
Prior to the reforms, Mexico had the most closed energy regime of any country in the world, save North Korea, some have quipped. This Latin perestroika is not going unnoticed in the US and abroad. It has become de rigeur at nearly every oil and gas conference to have at least one panel to discuss the changes, and with good reason.
Not only is Mexico close, the opportunity is huge. The country is prospective for 54.6 billion barrels of oil equivalent in conventional resources, and 60.2 billion in unconventional, according to PEMEX figures. And don’t forget NAFTA. Although Mexico’s energy industry had been excluded under Chapter 6 of NAFTA, that exclusion may no longer apply given the reforms, said Dallas Parker, a partner with Mayer Brown, during a presentation at Mergermarket’s 6th Annual Energy Forum last week in Houston.
January 23, 2014
Infraestructura Energetica Nova (IENOVA*) SAB, the Mexican unit of Sempra Energy (SRE), is being forecast by analysts as a winner because of energy legislation that helps it extend last year’s growth and a 53 percent stock gain.
Ienova is expected to be an “early beneficiary” of the energy law enacted by Mexico’s President Enrique Pena Nieto last month that will allow foreign companies to produce crude in Mexico for the first time since 1938, Credit Suisse analysts led by Vanessa Quiroga said in a Dec. 16 note to clients. Opportunities to enter oil and natural gas transportation and storage as well as electricity transmission and distribution will probably keep driving Ienova shares, according to Curt Launer, an analyst at Deutsche Bank AG. He rates the shares a buy with a target price of 67 pesos.
The second part of Mexico’s energy law will be debated in congress next month. Secondary legislation will determine legal specifics for contracts of foreign oil companies entering Mexico such as Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX)
“Energy reform brings in new capital and new drilling and makes Mexico able to grow its own natural gas production,” Launer said in a Jan. 21 phone interview from New York. “Ienova is very well positioned to be the natural gas processor, to be the liquids processor, and the joint venture they already have with Pemex looks like it would be a big winner in any of those circumstances.”
January 3, 2014
By Duncan Wood and Christopher Wilson
FT Beyondbrics, 1/3/2014
We will look back on 2013 as a truly historic year for Mexico. The scale of the reform process that was undertaken and largely achieved by President Enrique Peña Nieto is astonishing by comparison not only with other countries around the world today, but also in the context of recent Mexican history. For 15 years Mexico had seemed condemned to endure one of the less palatable elements of democratic systems, legislative gridlock. However President Peña Nieto, through a combination of determination, hard bargaining and political skill, has managed to work with the congress to pass a series of major reforms that do much to put Mexico on the road to modernity and competitiveness.
December 16, 2013
Last week Mexico’s Congress approved a bill to end a seven-decade long state oil monopoly. In coming years foreign companies could invest as much as $20 billion a year in Mexico’s oil sector, thanks to new rules that will allow production sharing.
Although the energy reform bill, spearheaded by Mexico’s President Enrique Peña Nieto during his first year in office, has been vociferously opposed by Mexico’s left, the bill has the backing of Peña’s centrist PRI party as well as the right-of-center party of former President Felipe Calderon. Together the PRI and the PAN had enough votes to push the bill through Congress, where it was approved 353-134.
December 16, 2013
The Wall Street Journal, 12/16/2013
Asian energy groups are looking at opportunities in Mexico following a decision to break Petróleos Mexicanos’s oil and gas monopoly, but they could face tough competition from Western rivals for the right to exploit the country’s huge and lightly developed reserves.
Mexico’s relatively stable political environment and geographic proximity to the U.S. could attract investors from there, including companies that have been selling stakes in Asian and African energy projects to focus on exploiting shale gas and oil opportunities nearer to home. Attractive Mexico projects could also interest European companies such as Spain’s Repsol, which is 9.3% owned by Pemex, and others already active in the country.
December 16, 2013
Financial Times, 12/15/2013
Mexico’s historic vote to open its oil and gas sector to private investment after 75 years yoked to the state is a political coup for Enrique Peña Nieto, the reform-minded president. Now for the hard part: delivering on it. Early next year, the government has to pass secondary legislation that will spell out the terms and conditions for foreign oil majors eagerly eyeing Mexico’s deepwater and shale riches and make them juicy enough to get the investment dollars flowing.
In the first half, it is expected to organise a so-called “Round Zero” in which Pemex, the state company , gets to cherry pick which fields it wants to develop and for which ones it will be seeking partners. That will mark a first opportunity for the likes of Chevron, BP, ExxonMobil and Royal Dutch Shell to stake their claims, even before the first tender.