Sheinbaum Rejects PPPs in Energy Sector: The Week in Energy

President-elect Claudia Sheinbaum shared with the Mexican Association of Hydrocarbon Companies (AMEXHI) her stance on public-private partnerships (PPPs), saying that they will not be part of her energy policy.

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Sheinbaum to Define Extent of Private Participation in the Sector
Sheinbaum mentioned that her administration will be open to private investment in the oil and gas sector, although denying a return to Enrique Peña Nieto's energy model, which, in her view, “favored private companies at the expense of the State.”

Public-Private Alliances Key to Mexico’s Energy Future: AMEXHI
AMEXHI called on Claudia Sheinbaum to reconsider public-private partnerships as a strategy to develop more oil fields, especially in unconventional areas, and to increase natural gas production in Mexico. According to the organization, these actions could generate budgetary benefits of nearly US$160 billion.

TC Energía, CFE Accelerate Underwater Pipeline Project
TC Energía, in collaboration with CFE, has intensified its efforts to complete the Puerta al Sureste pipeline, a key project for the transportation of natural gas in Mexico. The Canadian company recently announced plans to have this 715km underwater pipeline operational by mid-2025.

Mexico's Judicial Changes Could Impact USMCA
Proposed judicial reforms by the government could jeopardize USMCA negotiations and hinder economic competition in Mexico, experts warn. Mariana Campos, Director General, México Evalúa, noted that the reforms could undermine at least three chapters of USMCA: Chapter 14 on equitable treatment of investments, Chapter 23 on labor, and Chapter 27 on anti-corruption policies. "All these chapters require independent and impartial courts," she emphasized.

PEMEX, CFE Public Enterprise Shift Advances
Lawmakers greenlighted changes to the Constitution that would restore PEMEX and CFE to their former status as public enterprises of the State. This decision marks a significant shift away from their designation as "productive state enterprises," a status conferred during the previous administration's efforts to modernize and grant these entities greater budgetary autonomy.

Mexico's Energy Challenges Amid Nearshoring Opportunities
Tec de Monterrey and the Baker Institute have recommended restoring the autonomy of regulatory bodies and improving electricity transmission infrastructure to help Mexico fully benefit from nearshoring. In the report, the institutions emphasize that while Mexico has significant advantages toward attracting supply chain relocation, there are critical challenges in the energy sector that need to be addressed to fully take advantage of nearshoring.

Lithium-Free Batteries: Greener Alternative From DTU
The Technical University of Denmark (DTU) has developed an innovative rock-based material for creating lithium-free batteries, providing a more sustainable and eco-friendlier alternative for electric vehicles. The patented supermaterial is made from potassium silicate, which enables the development of silicate-based batteries. These batteries use rock minerals that are among the most abundant materials in the Earth's crust.

US Clean Power Association Warns of Constitutional Reforms Risks
The American Clean Power Association (ACP) has raised concerns regarding proposed constitutional reforms in Mexico, which could negatively impact clean energy development and strain trade relations between Mexico and the United States. These reforms, likely to be addressed in Mexico's upcoming legislative session starting on Sept. 1, 2024, are viewed as a potential threat to investment stability and could violate USMCA.

AMIVE Calls for a Just Energy Transition
The Mexican Association for the Promotion of Electric Vehicles (AMIVE) discussed the need for a "just energy transition" that includes current workers from various productive sectors. AMIVE emphasized that the skills required for the new economy should not only focus on young people but also on those already integrated into the value chains of the electronics, electrical, and automotive industries.

IMF Warns of Rising Emissions From Data Centers
The International Monetary Fund (IMF) highlighted that the expansion of data centers, cryptocurrency mining, and activities related to Artificial Intelligence (AI) are driving a significant increase in electricity consumption, which in turn raises carbon dioxide emissions.

Amigo LNG Signs LNG Supply Deal With Malaysia's E&H Energy
Amigo LNG has entered into a 20-year agreement to supply 3.6Mt/y of LNG to E&H Energy for the Malaysian market. The agreement, set to begin in the third quarter of 2027, marks a significant step for E&H Energy as Malaysia continues its gas market liberalization under the supervision of the Energy Commission of Malaysia.