The Oil & Gas Year Mexico 2017
With the ongoing energy reform, in conjunction with the continued softening of global oil markets, Mexico’s oil industry is shifting towards a more competitive model throughout its entire energy value chain.
Leadership of national oil company Pemex was handed to José Antonio González Anaya in February of 2016. The NOC faced a complex environment of declining revenues and greater national and international competition. Under these market conditions, and González Anaya’s management, Pemex is focusing on becoming a more competitive entity. The company has slashed non-essential spending and is pursuing a long-term strategy to acquire both capital and know-how through the development of strategic associations in several sectors, the first of which will be in the country’s deep waters.
Despite the drop in oil prices, the success of the first three phases of Round One, has sent a strong signal of the resilience of the Mexican upstream sector and the significant opportunities available to both local and foreign operators.
The ability of regulatory bodies to gain feedback from bidders and adapt their terms throughout these tenders has also been demonstrated. This has resulted in more attractive fiscal terms, more flexible bidding requirements, greater transparency related to the minimum government take ahead of bidding, and has attracted high-quality players to Mexico’s exploration and production sector.
The Round One tenders have reinforced the idea that Mexico is a world-class destination for oil and gas companies and they have also set the tone for the upcoming deepwater tenders.
The energy reform has brought about significant changes in other sectors as well. With the liberalisation of the electricity market, the government held its first and second long-term power auctions, expected to generate around USD 6.1 billion in investment. Besides opening the industry to private investors, these auctions are a part of the transformation of Mexico’s energy industry into a cleaner and more efficient one.
The expansion of the national gas pipeline grid with projects such as the Sur de Texas–Tuxpan pipeline will help to increase access to gas throughout the country and contribute to lower electricity rates.
In addition, new legislation has allowed private companies to import fuel alongside Pemex for the first time since the industry’s nationalisation. This opening will result in lower fuel costs, more investment in the retail sector and a boost in the competitiveness of the domestic economy.
The Oil & Gas Year Mexico 2017 analyses the changing landscape of the domestic hydrocarbons industry in light of newly enacted legislation and policies triggered by the energy reform under President Enrique Peña Nieto. Key insiders interviewed for the book include Secretary of Energy Pedro Joaquín Coldwell, Pemex general director of José Antonio González Anaya, former Undersecretary for Hydrocarbons Lourdes Melgar, Cenagas general director David Madero, Cenace general director Eduardo Meraz Ateca, and Undersecretary of Electricity César Emiliano Hernández Ochoa, as well as many top players operating in Mexico’s energy industry.
Extensive in depth analysis is supported by comprehensively developed maps, illustrations and graphs to create a market guide essential for players seeking to either expand their operations or enter the Mexican market.