PEMEX 'Forgives' McDermott PenaltyThu, 07/01/2021 - 17:45
An ASF analysis has found that PEMEX declined to charge US$7.94 million to offshore contractor McDermott as a penalty for a number of failures to fulfill contractual responsibilities. According to ASF’s research, McDermott was hired by PEMEX to do the EPC work for two marine ducts at KMZ, but their delivery of these ducts ended up being over 300 days late. According to a report from Forbes, ASF also found additional irregularities in the tendering and contracting process for this work which indicates that McDermott did not file all of the project’s documentation according to the stipulation set forth by the original tender.
Ready for More? Here’s the Week in Oil & Gas!
Oil Prices Shows Upward Trend
The Mexican crude basket has reached price levels unseen since 2018, hitting US$70.2 per barrel on June 25. However, lower production levels, a focus on refining and further high imports could hamper PEMEX’s possibility to benefit from this price increase, experts agree. On Friday, June 25 the Mexican export mix hit its highest point since October 31, 2018, an uptick of 60 cents compared to the previous day. Despite the price having dropped slightly after, an upward trend can be perceived, in which the Mexican crude basket joined WTI and Brent, as well as other international crude oil benchmarks. As of June 29, the Mexican crude basket stands at US$69.03.
Fuel Theft On The Rise: PEMEX
The latest reports released by PEMEX demonstrate a concerning increase in fuel theft incidents over the last quarter. Reported illegal taps on PEMEX ducts increased 9.5 percent in 1Q21when compared to 1Q20. The majority of these taps, 1563 in total, have been found in Hidalgo, while 894 have been found in Puebla and 477 in the State of Mexico. Other states with large reported numbers include Tlaxcala and Guanajuato. These five states account for 83.9 percent of all illegal taps found this year so far; they also occupied the top spots in 2020. In fact, just Hidalgo’s increase in illegal taps from 2020 to 2021 climbed to 31.6 percent. In Puebla, this same increase was 41.4 percent. Overall, between January and April of 2021, a total of 3759 illegal taps of PEMEX ducts have been discovered by the NOC, while the number for these same months in 2020 was 3430.
Over Half Million Liters Recovered: SEDENA
According to a report from SEDENA, between January 27th and February 22nd of 2021, 590000 liters of hydrocarbons were recovered in Hidalgo alone (a barrel is equivalent to roughly 158 liters). Despite these recoveries, further research also found that an average of 4700b/d were lost in the first 14 days of June 2021, the highest average of the year so far when compared to the rest of the months.
Illegal Taps Reports Increase
A surge of news and local media reports regarding arrests and events in the category of illegal taps has taken place this week. Two illegal taps were discovered in Coahuila and resulted in the recovery of 2000 liters of diesel by the National Guard. An illegal tap was discovered in CDMX, in the Azcapotzalco borough, and 64000 liters of stolen fuel were discovered in San Luis Potosi.