PEMEX Reveals Details of Latest Business Plan

A number of key aspects related to PEMEX’s latest business plan, covering the period from 2021 to 2025, have been shared with the press. The most commented details concern the NOC’s plan to tackle its debt, which according to El Economista increased to US$113.2 billion by the end of 2020. As previously reported by MBN, Mexico’s federal government has announced that it will assist PEMEX with its debt payments, which represents an expense totaling US$6.4 billion for 2021. With this financial aid, the NOC aims to reduce its debt to US$105 billion by the end of 2021. 

In addition, PEMEX plans to develop its presence in international markets and increase its profits since 2020 ended with losses that amounted to US$24 billion. The NOC’s focus on international markets responds to a loss of market share in local industries.  For example, by the end of 2020, PEMEX reported a total of 7,468 gas stations, a decrease of 40 percent compared to the 11,876 reported at the end of 2016, according to El Economista. Although MBN reported last week on President Lopez Obrador’s ongoing efforts to address this decrease in market share with a new energy reform that will benefit PEMEX’s downstream presence, these plans are likely to develop at a slower pace if they are marred, as the Electricity Law Initiative has been overshadowed, by numerous legal disputes. Furthermore, according to an analysis from Expansión, the business plan outlines a scenario in which the NOC will once again be profitable on a yearly basis by 2024, which differs from the announcements made at the beginning of the administration which claimed that PEMEX would be profitable by the end of this year. 

Another important item in this new business plan is the delay in the inauguration of the Dos Bocas refinery. While President López Obrador had previously promised that the refinery would start operations on July 1, 2022, this business plan instead expresses the “hope” that the refinery will become operational at some point in 2023, “if economic conditions allow for the appropriate investments to be made in its construction,” according to another report from El Economista. These investments are set by the business plan at US$2.23 billion during 2021 and US$5.75 billion for 2022, to be taken from PEMEX’s Industrial Transformation subsidiary budget.