Mexico Oil and Gas: Production Decline, Debt, Service Continuity

Between 2023 and 2025, Mexico’s national production platform underwent a  significant cumulative adjustment, with a 13% year-on-year decline reported in 2024 alone. This downturn is compounded by a more than 60% reduction in capital  expenditures allocated to exploration and production (E&P), a sharp contraction in the number of active rigs, and a marked decrease in drilled and completed wells. 

Field operations have relied increasingly on marginal gains from condensate production in the southern region, while short-term development expectations rest on just three potentially productive wells: Xomili-1, Iklum-1A and Bakte-1DEL. 

Service providers are facing severe financial stress. Total outstanding liabilities amount to MX$517 billion (US$28 billion), of which MX$86.3 billion is owed to companies affiliated with AMESPAC. Operational financing is increasingly constrained by negative working capital and upcoming debt maturities totaling US$6.84 billion scheduled for 4Q25. 

At the energy system level, Mexico remains heavily reliant on imported natural gas, which currently accounts for 73% of national supply. While progress has been made toward fuel self-sufficiency These gains still require closer coordination across the exploration, production, refining, and logistics segments. 

Taken together, these variables define a high-complexity operational environment that demands technical specialization, rigorous planning, and enhanced execution efficiency. 

Sector Assessment 

The sustained reduction in capital expenditures for exploration and production has exerted direct pressure on day-to-day operations. With fewer resources available, drilling, completion, maintenance, and well intervention activities have had to be reprioritized under stricter operational criteria. This has led to increased concentration on strategic assets and the deferral of projects that, while technically  promising, cannot move forward without sufficient budget certainty. 

In parallel, the limited availability of investment for new wells has curtailed the sector’s ability to add sustained incremental production, placing greater emphasis on the performance of producing fields and on the efficiency with which mature wells are managed. 

This dynamic further underscores the critical role of specialized services, including integrity management, workovers, artificial lift systems, produced water handling, and production optimization. Any delay in these service cycles can accelerate decline rates or compromise the overall reliability of the production system. 

Offshore infrastructure development has also advanced at a limited pace. Offshore operations depend on integrated logistics chains, specialized vessels, compression systems and gathering networks, all of which must remain continuously available. When investment programs are not executed on schedule, these support systems face constraints that can diminish asset performance and extend unplanned  maintenance windows. 

Amid this backdrop, the investment vehicle announced by the Ministry of Finance and Banobras has enhanced visibility into payment programs, a particularly relevant development for a sector that operates with highly specialized equipment, high-value inventories, and technical personnel who must remain trained and readily deployable. 

For oil-field services companies, predictability in these payment mechanisms has both accounting and operational implications. The continuity of work crews, availability of spare parts, leasing and maintenance of equipment, certification renewals, vessel mobilization, and the operation of industrial safety systems all hinge on stable and foreseeable cash flow cycles.

The Role of Oil-Field Services in Operational Continuity 

The oil-field services sector plays a critical role in sustaining the operational continuity of Mexico’s national energy system through technical capabilities that complement and strengthen PEMEX’s core operations. 

Service providers contribute engineering expertise, advanced technologies, and field-proven operational experience across the upstream value chain. Their work enables stable production, safeguards asset integrity, and ensures compliance with environmental and safety standards. 

On the exploration and production front, specialized companies perform well interventions, repairs, and stimulation treatments to offset the natural decline of mature fields. Their drilling units, downhole tools, and workover services restore productivity in strategic wells and enhance the performance of artificial lift systems. 

These activities reduce downtime, improve recovery factors, and sustain the production volumes required to meet established targets. 

Companies dedicated to mechanical integrity and industrial safety inspect, diagnose, and protect critical infrastructure. Their monitoring equipment, pressure-testing systems, structural assessments and corrosion control solutions maintain the reliability of pipelines, facilities, offshore platforms, and processing plants. These services mitigate operational risks and ensure that assets remain safe, available, and compliant with applicable regulations. 

Gas and condensate handling firms operate separation, gathering, compression, and metering systems that ensure stable and efficient hydrocarbon flow. Their expertise in advanced instrumentation and process control drives energy efficiency and supports the progressive reduction of routine flaring, one of PEMEX’s key environmental commitments. 

Offshore operations companies, in turn, mobilize vessels, transport specialized personnel, and support critical maneuvers required to operate offshore platforms, wells, and control systems under complex conditions, enabling planned maintenance and providing timely response to offshore contingencies.

Complementing these capabilities, automation and digitalization firms install control systems, conduct real-time equipment monitoring, and analyze operational data to improve efficiency, reduce losses, and enhance field-level decision-making. 

In parallel, engineering, construction, and major maintenance contractors modernize processing plants, upgrade critical equipment, and reinforce infrastructure across the refining, petrochemical, and compression segments. 

Together, oil-field services companies deliver the technical capabilities that PEMEX’s  integrated operations require to maintain production stability, mitigate risk, improve operational efficiency, and meet its environmental targets. Their contribution is grounded in proven solutions and continuous field presence, ensuring the structured execution of the national oil and gas system. 

Five Strategic Proposals to Strengthen Plan Execution  

Effective execution of the 2025–2035 Strategic Plan requires PEMEX to ensure continuous operations, equipment availability, infrastructure reliability, and timely access to operational data to support real-time decision-making. The company must also sustain interventions in mature fields, preserve the integrity of pipelines and surface facilities, manage produced gas with precision, and advance consistently toward its environmental goals. 

These imperatives define an operational framework that demands permanent technical capacity, in-field experience, and service providers capable of responding swiftly under strict safety and efficiency standards. 

AMESPAC member companies are already actively addressing these operational needs. Their field interventions enhance recovery in mature fields through the deployment of artificial lift systems and optimization strategies. They also maintain compressors, turbomachinery, and processing facilities, enabling more reliable gas and condensate handling. 

In addition, they install automation, metering, and monitoring systems that generate real-time operational data, improving well visibility and driving energy efficiency practices. At the same time, these companies inspect pipelines, verify mechanical integrity, and conduct diagnostics to help prevent risks across critical infrastructure. 

To unlock even greater operational value, the technical relationship between operators and service providers can incorporate targeted adjustments to facilitate more effective collaboration. Earlier communication of field requirements would enable more precise mobilization of crews and equipment. 

Better scheduling alignment would reduce idle time and ensure that specialized resources are available when operations demand them. A more standardized approach to documentation would streamline the delivery of technical outputs, supporting uninterrupted service continuity. Likewise, more systematic integration of supplier-generated data could enhance decision-making processes and strengthen preventive risk management. 

These practices do not imply new obligations; rather, they reinforce an existing technical relationship that with reasonable adjustments can operate with greater fluidity and predictability.  

AMESPAC and its affiliated companies will continue to contribute proven field capabilities and maintain an institutional dialogue focused on integrating these solutions more effectively into PEMEX's rational model. 

Through this vision, the Association reaffirms its role as a strategic partner, committed to supporting national energy operations with solutions that enhance production, safety, and sustainability across Mexico’s oil and gas system.