PEMEX is now the most indebted oil company in the world, as its financial debt rose to US$108.1 billion by the end of 2021. This remains a concern for companies investing in Mexico; the strategies adopted by the state-owned company have not met the expectations of its suppliers, to whom PEMEX owes more than US$3.7 billion as of 1Q22.
The state-owned company increased its debt by 84 percent in just five months, from Nov. 2021 to the end of April 2022, which forced PEMEX to propose a new payment scheme. On May 31, the NOC’s refinancing plan was presented to reduce a part of the debt with suppliers for US$2 billion dollars, through a peer-to-peer exchange that will offer the firm's 2029 global notes with an 8.75 percent coupon. However, PEMEX did not reach the US$2 billion it had established in a press release, as it only sold US$1.5 billion in bonds.
“The financial mechanism is implemented through the signing of an Agreement for the Acknowledgment and Repayment of Obligations between PEMEX and the suppliers and contractors, through which a pair-by-pair exchange of commercial invoices for global notes of the oil company with a coupon of 8.75 percent and maturity in 2029. The eligible invoices to be considered in the scheme were those pending payment, denominated in dollars and due until May 31, 2022”, explained the company in a statement before the execution of the plan.
The companies that participated in the scheme were financially affected, because they were only able to collect 80 percent of the bonds placed on the market, losing out on 20 percent of the value of the debt due to this exercise alone. Although the mechanism worked for PEMEX to reduce its debt with its suppliers by 48 percent, companies may not be willing to accept another refinancing strategy from PEMEX that could damage their finances further.
Some of the companies to which the state oil company owes the most are CFE Basic Supply, CEMEX, Baker Hughes, Blue Marine, Diavaz, GE Oil and Gas, Halliburton and Siemens, among others.