PEMEX to Launch New Payment Method for Suppliers, Contractors

Mexican state-owned PEMEX is preparing to implement a new payment mechanism for its suppliers and contractors. The goal of this new system focuses on expediting payment processes, reducing paperwork and providing greater transparency and accountability in the company's financial transactions.

Earlier in 2020, the company utilized COPADE, an electronic platform that answered queries and doubts related to debts and payments. The program eliminated the need for face-to-face interaction. However, the method showcased some discrepancies and was abandoned soon, according to sources from the Financial Post. 

President López Obrador has made PEMEX central to his goal of making Mexico self-sufficient in energy and reviving national production. However, the company has garnered a low credit ranking by Moody's Investor Service, a credit-ranking agency based in the US that downgraded the company rating to B1 or “junk” rating, indicating a relatively high level of credit risk. As a result, PEMEX has delayed payments to its suppliers, which has also led to layoffs in Mexico's oil services industry.

As of February 2023, the company owes a debt of US$4.5 million to its suppliers and contractors. Energía a Debate reports that the NOC’s Board of Directors recognized this gap and deemed it important to execute "the necessary financial mechanism to ensure that timely payments are made to suppliers and contractors of PEMEX and its productive companies subsidiaries.”

PEMEX’s debt owed to suppliers and contractors has increased by more than 61% since December 2022, when it amounted to almost US$3 million. In May 2022, PEMEX launched a payment mechanism for large suppliers based on bonds issued by the oil company, for a total amount of US$2 billion. At the time the company stated that “through this financial mechanism, which is widely accepted by suppliers and contractors, PEMEX did achieve great progress in reducing its liabilities and endorsed its commitment to work closely with the companies that provide it with goods and services, contributing to the growth of Mexico.”