Water Scarcity Could Deter Energy Developers From Crossing Border Into Northern Mexico

July 2, 2015

The Lago de las Monjas used to be a thriving lake but dried out a few decades ago. (Reason unclear.) will clarify

The state of Coahuila receives little more than 300 millimeters of rain annually (12 inches). So much water is being pumped in two farm regions near Cuatro Ciénegas to irrigate crops and care for livestock that not early enough is left to supply the pools and marshes. With every passing year, the desert claims more land, more ponds, and more streams that used to be wet.Photo © Janet Jarman/Circle of Blue.

Day 7 of our on-going article excerpts. Check out the blog again tomorrow for more, or head straight to our website for the remainder of the article.

Water Scarcity Could Deter Energy Developers From Crossing Border Into Northern Mexico

by Keith Schneider

A Ban on Groundwater Use For New Energy

According to Carlos Gutiérrez Ojeda, head of the groundwater division of the Mexican Institute of Water Technology, that leaves energy development companies with several other options for securing adequate supplies of water for fracking.

The first and easiest, said Ojeda in an interview, is for energy developers to buy existing groundwater use permits from farmers, industry, or other users.

Other options, he said, include:

  • Discovering and tapping new aquifers that lie deeper than known groundwater reserves. The deeper groundwater sources, if they exist at all, are likely to contain high levels of salt and minerals that will need to be treated. National water authorities are likely to issue permits to tap those brackish groundwater supplies, which are not currently used by cities, farms, or industry.
  • Recycling and treating wastewater from municipal and industrial treatment plants. That potential supply, though, is at least 80 percent less than what the energy industry is likely to need. An important consequence of using treated municipal wastewater is that this water supply is now discharged to streams and rivers. Thus, capturing this water could have the effect of reducing flows to streams, which could harm aquatic ecosystems and downstream water users.
  • Pumping water from the Gulf of Mexico and transporting it hundreds of kilometers in new pipelines to the drilling zones. Seawater is too salty for fracking using current technology. Some desalination capacity would need to be constructed near the sea, or at the other end of the pipe close to the drilling zones.

Summed up, if Mexico enforces its proposed ban on issuing drillers permits for existing groundwater sources, the industry’s water demand can only be met by uncertain and expensive supplies. “There are big questions that need to be answered,” said Ojeda. “We are looking closely at what could happen. Conagua says no groundwater will be used for fracking. Water must come from some other source. That’s what the authorities said.”

Among industry executives and government authorities charged with promoting job growth, though, the scale of what’s possible with shale development in Coahuila, and the potential investment treasure chest that it could open, overwhelms other considerations — for understandable reasons.


UPCOMING EVENT! Inequality in Mexico

July 1, 2015

social classWHEN: Tuesday, July 7, 9:00-11:00am

WHERE: 5th Floor Conference Room, Woodrow Wilson Center, Washington, DC

Click here to RSVP.

Mexico’s economic inequality has inhibited the country’s economic growth and slowed the potential of its social and human capital. And extreme inequality has worsened over the last 20 years, with economic elites capturing most of the benefits of growth. The political and economic implications are huge.

Oxfam Mexico recently issued a study on Mexico’s inequality and its policy implications, and the study’s findings will be presented and discussed at this forum on July 7, 9-11am. The study was authored by Gerardo Esquivel, professor and researcher at the Center for Economic Studies in the Colegio de Mexico.

Speakers

Ricardo Fuentes-Nieva
Executive Director, Oxfam Mexico

Marjorie Wood
Senior Staff Member, Global Economy Project, Institute for Policy Studies

Moderator

Duncan Wood
Director, Mexico Institute, Wilson Center

Click here to RSVP.


Coca-Cola And Pepsi Face Serious Security Problems In Guerrero Mexico

July 1, 2015

07/01/15 Forbes

guerreroNine months after the disappearance of 43 students in the town of Iguala in southwestern Mexico, Coca-Cola KO -0.43% has decided to shutter its facility in the nearby municipality of Arcelia, due to ongoing security problems. As I explained in a recent article for Fusion, “Citing concerns for the safety of its employees, Coca-Cola has decided to permanently shutter a storage facility in Arcelia, Guerrero, laying off 120 workers and eliminating one of the few sources of formal-sector jobs in the area.” Guerrero, the state where Iguala is located, presents a unique security challenge for multi-national companies due to high levels of poverty, low levels of development, and the presence of a noxious mix of organized crime groups, armed citizens militias, and militant student organizations.

Read more…


Amazon Launches Full Retail Operations In Mexico

June 30, 2015

06/30/15 TechCrunch

amazon_topicAmazon today formally announced its expansion into physical goods sales in Mexico. The company had previously only offered Kindle e-books on its online site which opened for Mexican customers in 2013. Today on Amazon.com.mx, Amazon will introduce a Spanish-language site featuring millions of items including consumer electronics, kitchen and home items, sports equipment, tools, baby, health and personal care products, jewelry, music, books, movies, software and more.

The company is also launching its online selling service for Mexican businesses and sellers as well as its Fulfillment by Amazon service.

Read more…


Officials hint at possible win for Uber in Mexico City

June 29, 2015

06/29/15 U-T San Diego

Mexico City TaxiMEXICO CITY (AP) — Times are tough for Uber in many parts of the world, from a recent California ruling that its drivers cannot be classified as contractors to a Paris taxi protest that became a riot and led France’s president to promise a crackdown. But the smartphone-based ridesharing app may soon get some good news in Mexico City. Ahead of a city government decision on its future, Uber recently got a ringing, though nonbinding, endorsement from the influential Federal Commission on Economic Competition. Even Mexico City’s Human Rights Commission has weighed in favoring the service.

Read more…


New Publication | A Mandate for Mexico

June 29, 2015

By Lucy Conger

mandate for mexicoIt was not so long ago that Mexico teetered on the brink of bankruptcy following a short-lived oil boom and a wild run of government spending. And, until quite recently, Mexico, despite sharing a 2,000-mile border with the United States, kept foreign goods out and gave domestic industries nearly exclusive access to a country-sized captive market.

Free trade has made Mexico a powerful manufacturing platform, a top global automobile assembler, and has radically diversified the economy, sharply reducing dependence on oil exports. The paradigm shift that unfettered Mexico’s protected and closed economy has been highly successful in creating a stable economic and policy environment and in making Mexico a marketfriendly global super-trader. But formidable challenges remain. Economic growth has slowed and consistently falls short of the level needed to create enough jobs to absorb the expanding domestic labor force.

Mexico is at a critical juncture. The record shows that the first wave of reforms that began 30 years ago failed to deliver the desired boost to economic growth and competitiveness. The reforms now underway promise even bigger changes for the economy, particularly by opening up the long closed petroleum industry. Looking ahead, can the new wave of reforms move Mexico into a higher gear, stimulate increases in productivity and economic growth, lubricate the economy with more credit, establish and enforce genuine competition in strategic sectors, and train the work force in modern skills? Or, three decades hence will we look back and say the Peña Nieto reforms were inadequately implemented and Mexico remains a low-growth, low-productivity economy?

This is a timely moment for reviewing Mexico’s success with deep economic reforms and asking what is required from here on in to make the new wave of reforms successful so that Mexico and Mexicans can enjoy the benefits of higher growth and productivity. This study offers a qualitative analysis of the deep economic reforms undertaken in Mexico during the past 30 years, the progress made and informed opinions on what is needed today to boost economic growth, enhance competitiveness and, hopefully, increase employment. The study summarizes the views about the successes and failures of the first wave of reforms as seen by a select group of former cabinet members and other prominent policy makers, consultants to government, opinion shapers in policy centers, and thought leaders in academia.

Download the report here.


Mexico’s Justice System At A Crossroads

June 29, 2015

06/29/15 Forbes

Aflag StarrGazrs an emerging market, Mexico has tremendous appeal. Its huge volume of trade with the United States, combined recent reforms in the telecommunications and energy sectors, means opportunities abound for savvy investors. But severe challenges remain. Pervasive corruption adds layers of risk to any business venture. Corruption has also hamstrung the nation’s justice system—and which many observers blame for Mexico’s intractable security challenges.

To date, reform efforts have languished. A series of constitutional and legislative reforms passed in 2008 sought to overhaul the justice system and root out corruption, but they have yet to be fully implemented. The 2008 reforms set a 2016 deadline for defining new criminal procedures and new duties for law enforcement and public agencies. Last year the government cleared an important hurdle with the passage of a unified criminal code, but much more work remains. With little less than a year to go, the fate of justice reform in Mexico appears quite uncertain.

Read more…


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