October 30, 2014
Petroleos Mexicanos signaled a return to profitability by the end of next year as the opening up of Mexico’s oil industry to private capital lifts the state-owned company’s production and reduces its tax burden. A 21 percent slump in the price of crude this year won’t damp Pemex’s plans to bring in partners for 10 of its existing blocks and bid for new areas on offer next year, Chief Executive Officer Emilio Lozoya said in an interview today. Facing eight straight quarters of losses, deteriorating output and a lack of resources to develop new finds, the former World Economic Forum executive is in talks with major producers as Mexico accelerates the industry overhaul that also includes lowering tax rates for Pemex. Speaking on Bloomberg Television’s “The Pulse,” he said crude will recover as demand picks up and deposits become harder to find and develop.
October 29, 2014
10/28/14 New York Times
The computer screens lining the bubble like 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.
October 20, 2014
10/17/14 Wall Street Journal
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 have seemed unrealistic: to regain its position as Latin America’s biggest company. For Pemex, as the company is known, that means leapfrogging Brazilian oil major Petróleo Brasileiro SA, or Petrobras, which holds the top spot in sales and has expansion plans of its own. Petrobras has been the star of the region’s oil sector for over a decade due to its technical expertise, growing oil production and international portfolio. Pemex’s crude production, meanwhile, has fallen for 10 years straight as the company’s shallow-water fields declined and much of its investment budget went toward squeezing more oil from older fields.
October 20, 2014
Pacific Rubiales Energy Corp. (PREC) signed an agreement with Petroleos Mexicanos to study oil and natural gas ventures as Mexico opens its energy sector to private investment for the first time in 76 years. The Bogota- and Toronto-listed company entered into a three-year arrangement with state-owned Pemex to analyze potential projects including deep-water and onshore heavy oil ventures, Pacific Rubiales said today in a statement. The shares fell 1.7 percent to 29,200 pesos at the close of trading in Bogota after earlier surging as much as 7.9 percent. “We expect Mexico will be a significant driver of future growth for Pacific Rubiales,” Chief Executive Officer Ronald Pantin said in the statement.
October 16, 2014
Lower oil prices may lead to less of a bonanza for Mexico as it ends a 76-year-old state oil monopoly and opens up to private investment, according to Marco Oviedo, chief economist in the Latin American country for Barclays Plc. The nation is set to hold its first round of auctions next year for oil production contracts that’s forecast to attract nearly $13 billion of investment a year through 2018, according to the Energy Ministry. It will also offer joint ventures with state-owned Petroleos Mexicanos. “Mexico is going to have a very, very important round-one bidding process in just a few months,” Marcelo Mereles, a former Pemex executive who’s now a partner at EnergeA, an energy consultant, said in a phone interview from Mexico City. “ The lowered oil prices could cause bidders to be less aggressive and or shy away from investing in Mexico immediately.”
October 16, 2014
Citigroup Inc. (C)’s Mexico subsidiary was fined 30 million pesos ($2.2 million) by the nation’s bank regulators, which faulted the firm for inadequate controls and making loans that violated lending rules. The regulator known as the CNBV announced the penalty in an e-mailed statement today. Banamex said in a separate statement that it paid the sanction and is working on corrective measures. Citigroup, the third-largest U.S. bank, said in February that it had discovered the Banamex unit had made bogus loans to Oceanografia, forcing the New York-based company to cut previously reported earnings for 2013 by $235 million. Banamex had advanced funds to Oceanografia secured by promises that state-run Petroleos Mexicanos would repay the bank for work the oil-services firm performed.
September 25, 2014
09/25/14 The Washington Post
Mexico overcame 75 years of nationalist pride to reform its flagging, state-owned oil industry. But as it prepares to develop rich shale fields along the Gulf Coast, and attract foreign investors, another challenge awaits: taming the brutal drug cartels that rule the region and are stealing billions of dollars’ worth of oil from pipelines. Figures released by Petroleos Mexicanos last week show the gangs are becoming more prolific and sophisticated. So far this year, thieves across Mexico have drilled 2,481 illegal taps into state-owned pipelines, up more than one-third from the same period of 2013. Pemex estimates it’s lost some 7.5 million barrels worth $1.15 billion.