Shell plans to invest at least US$1.4 million throughout 2022 in the exploration of its Round Three block, located approximately 100km north of Ciudad del Carmen, in the offshore area known as the “Yucatan Platform”. CNH has approved this sum according to the stipulations outlined in Shell’s exploration plan for this block, originally approved in 2019.
Ready for more? Here’s the Week in Oil & Gas!
Fuel Theft Levels Remain High in State of Mexico
A fuel leak stemming from a PEMEX pipeline was encountered in Teoloyucan, State of Mexico, presumably caused by huachicoleros. In 2021, around 244 cases of fuel theft were reported in Teoloyucan. This represents a significant part of the 4,567 incidents reported over the last three years in the state, which remain a bane to PEMEX’s finances. After a group of neighbors reported the leak, Civil Protection personnel and PEMEX security arrived at the site, as elements of the National Guard worked to repair the damaged pipeline. Authorities reported that there was no risk to the town’s population at present.
PEMEX Reform To Increase Environmental Efforts Passed
In an effort to increase PEMEX´s ESG efforts, the Senate approved a reform allowing the NOC to prioritize environmental measures. This initiative pressures PEMEX to carry out the exploration, extraction and production of its hydrocarbons, prioritizing environmental protection through climate change mitigation and adaptation measures, according to Congress members. Furthermore, the reform indicates that the state-owned company’s Administrative Council will need to make the necessary adjustments to its Organic Bylaw and issue a guideline and strategy program to implement mitigation and adaptation of climate change.
ASF Detects Significant PEMEX Losses During 2020
The ASF reviewed PEMEX’s finances as part of its wider review of all public institutions, called “Public Account 2020”. This public review generated criticism against President López Obrador after reporting millions of pesos in cost overruns and detected irregularities in the delays that have plagued the construction of the Dos Bocas refinery, along with other flagship infrastructure projects. The president minimized the irregularities detected by the ASF by saying that the review “is still preliminary; a work in progress.” The ASF’s research revealed that PEMEX lost over US$25 billion in 2020, representing an increase of 47 percent in losses compared to 2019. This means the NOC lost almost US$69 million a day during 2020. Mexico’s export mix reached a historically low value of minus US$2.4 per barrel in April of 2020, although much larger negative values were common in the market throughout that month.
Baker Hughes Audit Absolves PEMEX Of Corruption Charges
Baker Hughes, PEMEX’s long standing contracting partner, came under fire in the past two weeks due to its association with corruption allegations made against the son of President López Obrador. To refute these allegations, Baker Hughes hired an external law firm to audit all agreements between the company and the NOC. It announced its findings in a joint press conference with PEMEX this week. The audit concluded that no conflict of interests or irregularities were found in the contracting interactions between Baker Hughes and PEMEX, making it clear that the relationship between the two companies was cleared of the charges made by these accusations.