PEMEX Refinery Will Not be Finished on Time
The refinery in Salina Cruz, which is part of PEMEX’s broader efforts to modernize and expand its refining capacity, is not expected to meet its 2024 deadline. Furthermore, PEMEX reports lower profits for the first quarter of 2023.
Ready for More? Here is your Weekly Round-Up!
PEMEX Reports Lower Profits in 1Q23
PEMEX attributed the decline in profits to lower crude oil production and lower export prices. Despite the decline in profits, PEMEX CEO, Octavio Romero Oropeza, said that the company is making progress in its efforts to reduce costs and increase efficiency. "First-quarter results are a reflection, as we have already said, of our efforts toward operational discipline and efficiency, combined with a favorable oil price environment. That positive inertia transferred to the first quarter of 2023," adds Romero.
Government Lifts Tax Breaks on Premium Gasoline
The drop in oil prices has incentivized the Mexican Treasury to remove a fiscal stimulus from Premium gasoline and to reduce tax incentives for Magna gasoline and diesel for the first time since 2022. Without the incentive, the consumers must pay the full tax on fuel for Premium gasoline: MX$4.9987 (US$0.2806) per liter.
14,000 Wells Abandoned in the Gulf of Mexico
There are around 14,000 oil and gas wells that have been abandoned in the Gulf of Mexico, which is a significant environmental and safety concern. Many of these wells were drilled decades ago, and some of them were never properly plugged. The wells continue to release methane and other substances harmful to the environment in offshore waters.
Salina Cruz Refinery to Miss Construction Deadline: PEMEX
The Salina Cruz refinery is part of the NOC’s broader efforts to modernize and expand its refining capacity, which has been hampered by an aging infrastructure and declining oil production. The new estimated date for completion is 2025.
CRE Highlights Low-Consumption Service Station Opportunities
CRE highlighted the low level of gasoline consumption at service stations in the country and suggested that this presents an opportunity for new players to enter the market. According to Guillermo Pineda Bernal, Commissioner, CRE, Mexico has 1,000 areas where it would be profitable to install gas stations.
The Government will not Inject Capital into PEMEX
Mexico’s Deputy Finance Minister Gabriel Yorio said that PEMEX must address its financial challenges through its own efforts, such as increasing efficiency and reducing costs. He also emphasized the importance of improving governance and transparency at the company, which has been criticized for a lack of accountability and for its close ties to the government.