Mexico Finance Ministry Preparing Pemex Support, Official Says

3/8/2016 Bloomberg

pemex2Mexico’s Finance Ministry is preparing a support plan for Petroleos Mexicanos and studying all potential options, including a capital transfer or reducing the company’s tax burden, chief economist Luis Madrazo said.

Capital aid for Pemex could come from part of the special revenue that the government will receive from the central bank’s operational surplus, Madrazo said in an interview in Mexico City on Tuesday. While the government should receive those funds by the end of April, Madrazo declined to say when support measures will be announced, saying they’re still being prepared.

Mexico has been focusing on ways to turn Pemex around after a record $32 billion loss in 2015 and 11 straight years of production declines. The company last week pledged to meet the government’s demand that it trim its 2016 spending by 100 billion pesos ($5.6 billion) by increasing efficiency and focusing on its most profitable projects.

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