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News Article

PEMEX Bets on Fuel Oil

By María Fernanda Barría | Wed, 03/10/2021 - 08:21

PEMEX significantly enhanced fuel oil production at its refineries in an effort to meet the government's ambitious gasoline refining goals. According to Forbes, oil refining in Mexico reached its highest level in April 2018 but it is still far from the targets set by the current administration. 


Last January, PEMEX increased activity at its six refineries, with fuel oil playing an increasingly important role. “Fuel oil will be used for electricity generation, subject to the application of emission reduction technologies, which makes it possible to take advantage of existing infrastructure,” said SENER in a press release. According to the ministry’s data, during January 2021, refining at PEMEX’s six refineries increased by 8 percent compared to the same period last year. The best performance was shown by the Salina Cruz refinery, which produced 45 percent more than in January 2019. 


Fuel oil, a petroleum derivative, does not get a good press in a world that is moving toward renewable energy. However, it has become an important commodity for Mexico, which has managed to place it on international markets despite a recent ban on its use by the International Maritime Organization. In addition, the rise in exports was driven by increased demand from US refineries. In January 2021, PEMEX recorded the highest sales of fuel oil since July 2019. This, however, does not bode well for environmental objectives. “The use of fuels that have been discontinued and banned in the world, such as fuel oil, is worrying. These decisions will have severe health, environmental and economic implications due to the inefficiency and high cost of the generation processes. We cannot continue burning fuel oil to generate electricity,” said Pablo Ramírez, Energy and Climate Change Specialist at Greenpeace Mexico.


López Obrador promised since his presidential campaign a policy based on energy sovereignty, which in practice translates to the strengthening of state-owned companies. The intention is to reduce fuel imports by empowering national refineries and developing the Dos Bocas refinery in Tabasco. 


 

The data used in this article was sourced from:  
Forbes, El Economista, Sener, Expansión, PEMEX, Green Peace
María Fernanda Barría María Fernanda Barría Junior Journalist and Industry Analyst