CNH Commissioner Discusses Energy Sector

Héctor Moreira, Commissioner, CNH, opened a new Twitter account and took the chance to discuss important energy topics in Mexico. 

“The issue of energy availability in Mexico is of the utmost importance, however, even with all the information available there is much confusion about transcendental issues in this area. In this thread, I will try to clear up 10 common misconceptions about energy,” he wrote.

Apart from some technicalities regarding oil production, Moreira shared that finding hydrocarbon deposits is difficult as opposed to easy, as it takes three to four years to discover a deposit between 500 and 8,000m of depth using reliable, specialized studies. Moreira also contradicted that oil will soon run out: “It is known that around the world, undiscovered oil deposits in different regions and at great depths exist. In global terms, we are consuming less oil than is being discovered.” 

This is not the first time that CNH and experts have highlighted the importance of venturing into unconventional plays. Due to Mexico’s declining oil reserves, experts have underlined the potential that those plays have to boost the country’s reserves. Recently, Mexico’s Safety, Energy and Environmental Agency (ASEA) announced that it is working on a legal norm for companies to use fracking if the next administration legalizes this extraction method.

Regarding natural gas production, Moreira clarified that despite the country’s dependence on imports, Mexico is the sixth country with the highest reserves. He added that natural gas production was highly profitable and that while it can be flared, the aim is to capture up to 98% of it. 

However, last month it was found that PEMEX had flared US$275 million worth of resources at Ixachi in three years and another US$67 million at Quesqui in two years. While Mexico has tried to cut its dependency on US gas by increasing national production, demand has increased as well.

Moreira furthermore explained that even though electric vehicles do not generate as many emissions as gasoline-fueled vehicles, the pollution associated with EVs has to do with its components and the energy that feeds them. Moreira finished his thread by tackling the misconception that power plants run all the time. “Storing electrical energy is very expensive, therefore, production must be equal to consumption. This implies that at dawn, there are fewer active plants and as consumption increases, more plants begin to produce,” Moreira concluded. 

According to experts, Mexico’s lack of storage is a matter of national security too. Insufficient storage poses a threat to the country in case of supply interruptions or extraordinary events that could affect the pipeline flow. Nevertheless, despite the urgency for energy self-sufficiency, the government has prioritized large-scale infrastructure projects over storage.