Pemex admits a “critical need” for technology from Repsol [In Spanish]

El País, 4/26/2012

The increase in the participation of Pemex in Repsol and its interest in forming an alliance with the Spanish company have to do with Pemex’s “critical need” to acquire technology for deep-sea oil exploration like the one developed by Repsol. Pemex acknowledged this in response to an information requirement made by the U.S. Securities and Exchange Commission (SEC), who asked Pemex to explains the reason for its alliance with Sacyr and its increase of 9.8% in participation within Repsol.

Washington was worried that Pemex would use its alliance with Repsol to invest jointly in the search for petroleum in Cuba. A letter sent by the Office of Global Security Risk of the SEC that was sent to Pemex in October 2011 was recently revealed. The document warned Pemex that Repsol “has operations in Cuba, an office in Iran and contacts in Syria.” In this respect, SEC demanded from Pemex an explanation to a possible “reputation damage” in its relationship with Repsol.

In its response to Washington, Pemex concluded that if Repsol’s presence in Cuba is not relevant for the Spanish company, it is also not relevant for Pemex and particularly because Pemex does not take part in Repsol’s activities in Cuba. The letter continued by revealing Pemex’s real interest in Repsol: “We also want to point out that Pemex’s interest in a future cooperation with Repsol is justified by the critical need of Pemex to develop the technological expertise, knowledge and experience in deep-sea water drilling, and not because of a desire to invest resources in exploration and production outside the Mexican territory.” The response also added that, “Repsol obtained its valuable expertise, knowledge and experience from deep-sea water drilling in its exploration and production activities in the waters of the Gulf of Mexico and in the Brazilian coast.”

Both Repsol and Pemex signed a 10-year strategic industrial alliance.

Read more…


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