Finance Minister: PEMEX to Pay 2023 Debt Amortizations by Itself

PEMEX is in a difficult position as it is bound to pay US$8.2 billion in 2023 and US$9 billion more in 2024 in both bonds and long-term bank loans. The NOC is under debt totaling up to US$108 billion. Minister of Finance Rogelio Ramírez de la O, however, stated during a press conference in Merida that he expects the NOC to handle its debt amortizations for the year.

"In 2023, we are expecting (PEMEX) to be able to manage its debt amortizations and we are going to be behind it in case it is required,” said the minister at the press conference during Mexico's annual banking convention.

PEMEX has been struggling with high levels of debt for years and the Mexican government has been working to support the company's finances. In 2021, the government injected US$1.3 billion and US$1.6 billion as capital and offered tax reductions of US$3.68 billion. 

De la O’s statement comes after President López Obrador’s decision to aid the company in January 2023. "They have, I repeat, a plan to cover debts for this year," the president told reporters, adding that the ministry is offering its "complete support" to PEMEX. Nonetheless, PEMEX’s financial situation remains a concern for some analysts and investors as Moody’s Investor Service, a credit-ranking agency based in the US, downgraded PEMEX’s rating to B1 or “junk” rating in 2020, indicating a relatively high level of credit risk and making it difficult for the company to borrow capital from the market. 

As a response, Octavio Romero, CEO, PEMEX, told Reuters, that these agencies have “punished" PEMEX by declaring its bonds speculative or junk despite the company making progress on boosting its production from January to May of 2022, reaching an average production of 288Mb/d of gasoline, 24.8 percent more than the year before.