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Mexico's next president began developing his plan to save the country's oil sector, which has long been neglected.
Proposals by Andrés Manuel López Obrador include a $ 4 billion capital injection for Petróleos Mexicanos (Pemex), to promote exploration, a new refinery to reduce the purchase of fuel at United States and increase 600 million barrels per day oil production in two years.
But analysts warn that with this energy policy With a national approach, there is a risk of exerting unsustainable pressure on the world's most indebted oil company. In particular, they highlight plans to build a refinery of 160 billion pesos ($ 8.6 billion) in Tabasco over the next three years, an investment equivalent to the size of Pemex's losses in the second quarter .
López Obrador did not give details of how he would finance his proposals, but he appointed Octavio Romero Oropeza, a long-time confidant and agronomist from Tabasco, to take command of Pemex. "We estimate a total investment of 175 billion pesos next year to save the sector," said the president-elect.
The liquidity injection occurs when Pemex has recorded a collapse in production from its peak of 3.4 million barrels per day in 2004 to 1866 million in the second quarter of this year.
López Obrador said that the fall in production is due to "energy and the oil industry have been abandoned", and he promised to increase production to 2.5 million barrels of crude oil a day in two years.
It remains to be clarified whether it intends to pursue tenders with which more than 100 contracts have been awarded to 73 companies since 2015 as part of the historic reform designed to increase crude oil production. a minimum in four decades. The new administration wants to at least temporarily stop the oil offers.
"Four billion dollars, that's a significant amount, that's no question, but it's important to put it in perspective … a single round of bids can inject more than a few dollars." "Investments," said Pablo Zárate, of Pulso Energético's expert group
López Obrador promises to achieve energy self-sufficiency by spending 49 billion pesos. modernize the six Pemex deficit refineries, whose production has been cut in half since May 2013, and the construction of two refineries to stop the reliance on gasoline imports from the United States, which has recorded an increase of one-third
But investors are worried about the possible gradual increase in costs. The price of the first refinery, which will be built in Dos Bocas, has already increased from $ 6 billion that the López Obrador team said earlier. "I do not know of any refineries that were made in his budget," said a large fund investor who closely monitors Pemex.
Pemex, a monopoly of eight decades, has spent the past two years ordering its finances "Pemex does not have the cash to build more refineries and if it decides to finance them by debt or change the capital and refining production, its credit indicators will weaken, "warns Moody's Investors Service
.The increase in refining capacity may reduce Half the value of Pemex's lucrative oil exports, he added.But Lopez Obrador said his government will keep its promise to stop gasoline imports in three years and reduce fuel prices. 19659002] Pemex has a debt of about $ 106 billion, and is expected to report profits before interest, taxes, depreciation and amortization of $ 25 billion this year.With the state, which levies 70% of the profit With taxes, Pemex could increase its throughput to pay refineries, given that it already has large debt payments with maturities in 2019 and 2020.
The López team Obrador said he wants to stop the oil auctions while reviewing the contracts already awarded and decides if and how fast it will continue.
In fact, the government has delayed two upcoming offers, which include joint ventures with Pemex, until next February. Adrián Lajous, former CEO of Pemex, has advocated a moratorium on oil offer calls until 2020, but said joint ventures with Pemex are expected to resume next year.
Even if oil offers go into the freezer, Analysts urge the new administration to allow Pemex to continue forging joint ventures
"Partnerships will be needed for the joint venture to grow". International companies provide capital and technical expertise, "said Ruaraidh Montgomery of Wood Mackenzie.
Above all, "Pemex must enter into partnerships with companies specializing in enhanced oil recovery, given the maturity of its portfolio." According to Pablo Medina, of Wellingence Energy Analytics, the radical modernization of Pemex could follow the example of the "Chinese model," said Juan Carlos Zepeda, director of the Mexican oil regulator. the parent company is in the hands of the state, but transfers some assets to a partially cited unit, such as China National Petroleum.
"I would like to do the same thing with Pemex, but it will require a constitutional amendment," he said. .
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