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News Article

Oil and Gas Deal with Private Sector in February: AMLO

By Pedro Alcalá | Wed, 01/29/2020 - 18:36

During Wednesday’s daily morning press conference, President Andres Manuel López Obrador informed the public about PEMEX's strides towards achieving its goals as outlined in last year’s business plan. López Obrador announced that an agreement is about to be reached regarding the full extent of private sector investment in Mexico’s oil and gas sector.

After brief and general introductory remarks from the president, PEMEX Director General Octavio Romero Oropeza gave a speech concerning production levels. He placed the current January levels at 1.74MMb/d, which he then contrasted with what predictions said would have been said levels by now if the new administration had not implemented the necessary policies, which he placed at 1.51 MMb/d. He also presented projections for production levels to be reached by the end of March in the order of 1.8MMb/d. Oropeza claimed that a level above 1.9MMb/d would be reached by the end of 2020.

Oropeza then presented PEMEX’s current financial situation and the recent issuing of bonds. Oropeza said that there continues to be a demand for PEMEX bonds in international financial markets, contrary to the lack of confidence promoted by last year’s downgrading of PEMEX’s credit rating.

Both Oropeza and President López Obrador reiterated their lack of intentions to open new bidding rounds or to invest in PEMEX the resources needed to develop either deepwater or unconventional resources. They both recognized Eni's success in entering a productive phase in their blocks, while also anticipating that Mexican company PetroBal, together with their partner Fieldwood Energy, were expected to also enter production phase this year. However, the president did announce that by February a comprehensive plan would be presented which will consist in a system of new deals and agreements between PEMEX and the private sector. These would cover service contracts essential to the development of oil and gas infrastructure throughout his remaining time in office.

Pedro Alcalá Pedro Alcalá Senior Journalist & Industry Analyst