Mexico’s energy policy gives the U.S. no choice but to push back


Source: Washington Post

The United States and Mexico have plenty of tough issues to deal with, from the lingering coronavirus pandemic to inflation to the continuing surge of migrants through their mutual border. It would be best for both countries if they could address these issues in an atmosphere of calm and mutual cooperation, with no gratuitous irritations to this vital bilateral relationship.

Unfortunately, such irritation is all too likely as long as Andrés Manuel López Obrador occupies the Mexican presidency. A quirky populist whose worldview centers on restoring what he misperceives as the lost glory of Mexico’s nationalized oil industry, Mr. López Obrador inherited a modified version of the North American Free Trade Agreement that his predecessor had negotiated with President Donald Trump; it took effect on July 1, 2020. And yet Mr. López Obrador has continued to press for greater control over Mexico’s energy markets, to the point where his policies now arguably violate the terms of the revised trade pact, known as the U.S.-Mexico-Canada Agreement (USMCA). The Biden administration has no choice but to push back.


Mexico Has Tanker Traffic Jam as Pemex Splurges on Foreign Gasoline


Source: Bloomberg

More than 60 ships carrying an estimated 18 million barrels of fuel are sitting off the coast of Mexico waiting for storage to open up so they can unload — and paying hefty fees for every day they’re forced to wait.

The majority of those vessels are carrying gasoline and diesel imported by state-owned Petroleos Mexicanos, people familiar with the situation said. With daily penalties of about $40,000 per ship charged for every day of waiting, fuel importers stuck in line are paying about $2.4 million a day in total, with Pemex bearing the bulk of it, people said.


New refinery could cost more than twice the original estimate


Source: Mexico News Daily

The cost of the state oil company’s new refinery on the Tabasco coast could blow out to more than double its original estimated price tag, according to a report by the news agency Bloomberg.

The Dos Bocas refinery, which will be officially opened July 2, could cost as much as US $18 billion, according to Bloomberg sources, a price tag that would be $10 billion higher than the project’s initial budget.


Los apagones aumentarán en el verano


Fuente: El Sol de México

Los apagones eléctricos en el país se intensificarán durante el verano, aseguró el presidente del Consejo Nacional de Energía y Petroquímica, Horacio Zárate Acevedo.

En entrevista con Organización Editorial Mexicana, Zárate Acevedo dijo que México debe modernizar su sistema eléctrico, “para eso era la reforma eléctrica (planteada por López Obrador), para entrar en una nueva etapa de desarrollo, en donde empresas y gobierno pudieran participar”. Sin embargo, aseguró que el tema se politizó, la reforma fue enterrada y ahora la red eléctrica del país está saturada.


Anticipan apagones; ya culpan a privados


Fuente: Reforma

A unas semanas de que comience el verano, el País está en riesgo de presentar apagones generalizados y el Centro Nacional de Control de Energía (Cenace), encargado de controlar el sistema eléctrico, ya tiene a quienes responsabilizar: las centrales renovables.

Así lo advirtió Ricardo Mota Palomino, director general del Cenace, en un foro realizado el 17 de mayo, quien además destacó la falta de mantenimiento en redes de transmisión como resultado del modelo que impulsó la reforma del 2013.


Factbox: Changes to Mexico mining law set to nationalize lithium resources

MEXICO CITY, April 18 (Reuters) – Mexican President Andres Manuel Lopez Obrador’s plan to increase state control of power generation was defeated in parliament on Sunday, as opposition parties united in the face of a bill they said would hurt investment and breach international obligations.

Date: April 18th, 2022

Source: Reuters

His National Regeneration Movement (MORENA) and its allies fell nearly 60 votes short of the two-thirds majority needed in the 500-seat lower house of Congress, mustering just 275 votes after a raucous session that lasted more than 12 hours.

Seeking to roll back previous constitutional reforms that liberalized the electricity market, Lopez Obrador’s proposed changes would have done away with a requirement that state-owned Comision Federal de Electricidad (CFE) sell the cheapest electricity first, allowing it to sell its own electricity ahead of other power companies.

Read More

In Quest for Energy Independence, Mexico Is Buying a Texas Oil Refinery


Source: The New York Times

DEER PARK, Texas — Two giant murals, on storage tanks at an oil refinery here, depict the rebels led by Sam Houston who secured Texas’ independence from Mexico in the 1830s. This week those murals will become the property of the Mexican national oil company, which is acquiring full control of the refinery.

The refinery purchase is part of President Andres Manuel López Obrador’s own bid for an independence of sorts. In an effort to achieve energy self-sufficiency, the president of Mexico is investing heavily in the state-owned oil company, placing a renewed emphasis on petroleum production and retreating from renewable energy even as some oil giants like BP and Royal Dutch Shell are investing more in that sector.


Mexico’s lithium and the global race to lock in ‘white gold’


Source: Al Jazeera

This year’s political moves surrounding Mexico’s lithium reserves have tested the limits of President Andres Manuel Lopez Obrador’s (AMLO) pledges to keep the country’s most precious natural resources firmly in Mexican hands.

In October, AMLO unveiled a sweeping energy reform bill that included nationalising Mexico’s lithium deposits as a strategic mineral – a move that threw into doubt China’s ability to lock in a critical reserve of lithium to support its green energy transition plans.


Mexico may cut Pemex tax liability in bid to boost oil production

Source: World Oil

MEXICO CITY (Bloomberg) –Mexico could slash Pemex’s taxes further as the world’s most indebted oil company scrambles to reverse long-term oil production declines.

“With Pemex, for example, we are constantly or periodically lowering taxes so they have more funds,” said President Andres Manuel Lopez Obrador during his daily press conference on Monday. “And we can lower them more.”

In September, the government cut Pemex’s profit-sharing duty to 40% for 2022 from 54% in 2021. Last week, Pemex announced that it will receive a $3.5 billion capital injection from the government as part of a transaction to pay down obligations and also embark on a series of bond buybacks and new issuance to reduce the cost of servicing its borrowings.


At Summit, U.S., Canada and Mexico Avoid Thorny Questions


Source: New York Times

President Biden hosted Prime Minister Justin Trudeau of Canada and President Andrés Manuel López Obrador of Mexico at the White House on Thursday, a diplomatic mission that saw three leaders trying to project a united front amid trade scuffles, accusations of American protectionism and ongoing concerns over surging migration at the U.S.-Mexico border.

But while they agreed to form a working group on regional supply chain issues, including for critical minerals, and struck an agreement to share vaccines, the leaders seemed intent on relaying diplomatic niceties over tackling thornier questions like trade disputes or the surging numbers of migrants.