There are so many news about the present and future of still-state-owned oil company Petróleos Mexicanos (Pemex) that it will take weeks of writing to cover them all. But here’s an eye bird’s view of some of the newsworthy current events to come both for the company and fuel consumers.
PemExxon Valdez?
For starters, the nomination of giant oil producer ExxonMobil’s chief executive president Rex W. Tillerson to become U.S. president-elect Donald Trump’s Secretary of State sent shivers up the spines of all those related with the industry.
The Tillerson nomination – yet to be approved by Congress – reminded everyone that he was very much involved in the bids to pump oil from the Gulf of Mexico just last Dec. 5 in which both Exxon and French company Total won the bid to exploit a huge tract of sea bottom land.
That’s one. In 2014 Exxon and Pemex former director Emilio Lozoya Austin signed a memorandum of understanding to establish the basis for joint business opportunities which will surely bear fruit – I mean oil – in the not so far offing. Tillerson, though not directly involved, was surely overseeing ExxonMobil’s future preliminary $6.5 billion investment in the Gulf of Mexico joint-venture.
In terms of politics, there’s fear that from the State Department Tillerson might exercise power to influence an increasing “invasion” of Pemex, as oil will be a moving force of politics again between the two nations. Only this time Mexico – with President Peña Nieto’s Energy Reform now underway – opened up to international investment which, in the view of Energy Reform opposition, will deliver the nation’s oil right into the hand of big companies which will be poorly managed and financially rob Pemex into oblivion.
Does the future hold a change of name from Pemex to PemExxon Valdez? With Tillerson – if he’s approved – the fear is that it may happen but from the current looks of the company, it is already a shipwreck.
Gas Price Lib
Two things are going to happen in the Mexican gasoline market come January: the liberation of gasoline prices will begin and fuel prices in general will be slapped with new taxes as programmed in the 2017 Federal Goverment budget.
The liberation process is part of Peña Nieto’s Energy Reform that at first was to start in 2018 but the President decided to move it up one year establishing a three percent range of fuels price shift either up or down and keep them under control until they are fully unleashed to market forces. The liberation calendar will be announced by the Energy Regulation Commission over the next two weeks but it will take immediate effect at U.S. border cities while the rest of the nation will be regionally timed and according to local market conditions.
As for gasoline hikes, the 87 octane Magna is expected to go from 13.98 to 16.87 per liter, while the unleaded Premium will rise from 14.81 to 17.75.
Be ready for bus and taxi price increases, in case you don’t drive in Mexico. But of course, the government says “inflation is under control.”
Gas Robbery
The largest milking cow in Mexico does not have four legs and does not say “moo.” It’s Pemex, whose main ducts from refineries to distribution centers get “milked” by thieves and organized criminal gangs.
The nation’s main ducts carrying separately Magna and Premium fuels are the main targets of thieves. The Minatitlán Mexico City duct which crosses the states of Veracruz, Puebla, Tlaxcala and Stated of Mexico is leeched of 92,000 liters per day, an increase of 17 percent over 2015. This duct, according to Pemex, had a loss of 223.8 million liters between 2009 and 2015, enough fuel to fill up 11,000 rigs.
Another duct is that of the Salamanca refinery. On a daily basis this writer gets a press release from the Guanajuato State Security Police claiming that they caught suspects with amounts that go regularly from four to 9,000 liters and deposits from which they redistribute the stolen fuel.
Fortunately, the Tula and Salina Cruz refineries are better protected, but not aloof from the attention of the milkmen.
Who are the thieves? It takes an oil engineer to come up with the piping to suck gas from the ducts.
Like the old saying goes, the enemy is within Pemex.
