Mexican Congress approves energy reforms

Mexico’s Congress has passed historic constitutional reforms opening the energy industry, including oil and gas, to private investment (OGJ Online, Oct. 14, 2013).

The reforms build on amendments proposed Aug. 12 by President Enrique Pena Nieto, who proposed changes to the country’s strict limits on foreign energy investment but left details to Congress.

The Senate on Dec. 11 passed a reform bill opening the industry to competition and specifying that participation terms available to Congress for oil and gas production and development will include licenses, production-sharing, profit-sharing, and service contracts. It left open the possibility for other types of contracts.

The Senate bill also stipulated that the board of Petroleos Mexicanos, the state oil monopoly, include five independent members and five representatives of the federal government, including the secretary of energy, who can cast decisive votes in ties. The legislation removed representatives of the Pemex union from the board.

The lower house of Congress passed the Senate version of the reform bill without change. The legislation must be approved by a majority of state legislatures. The law firm Mayer Brown said the approval “is expected soon.”

In a Dec. 13 report, Michael Cohen of Barclays Research said, “Approval of this landmark legislation could insert the missing piece of the North American energy landscape” and have “dramatic medium and long-term implications given the US’s tight oil and Canadian oil sands.”

But development likely will be slow, requiring investment at more than twice the current rate by Pemex, about $24 billion/year, Cohen said.

He said slight near-term increases from current production of 2.5 million b/d are possible but called government targets of 3 million b/d by 2018 and 3.5 million b/d by 2025 “ambitious.”

Related Articles

Judge bars Anadarko e-mails as evidence in Macondo blowout hearing

03/21/2014 A federal district judge in New Orleans refused to accept e-mails between Anadarko Petroleum Corp. and BP PLC as evidence in a hearing to determine...

Industry group welcomes most UK budget moves

03/21/2014 Oil & Gas UK voiced support for all but one of several measures affecting the offshore producing industry announced in the UK government’s annu...

MARKET WATCH: Crude oil, gas futures prices slide entering spring

03/21/2014

The first day of spring in the northern hemisphere was marked by lower crude oil and natural gas futures prices.

OMV acquires West of Shetland licenses from Hess

03/21/2014 OMV AG has reached an agreement with Hess Corp. to acquire four licenses in West of Shetland, UK, including Cambo field and the Blackrock prospect,...

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected