The Week in Oil and Gas: Estafa Maestra Investigations Expand

PEMEX E&P Deputy Director Disqualified for 10 Years

Mexico’s Ministry of Public Administration has dismissed Héctor Salvador Salgado from his position as Deputy Director at PEMEX E&P and barred him from any public office for 10 years  due to omissions made in his financial statements.

Salgado, who was also the administrator in charge of the offshore Ayatsil-Tekel field development project, was investigated as part of the ongoing Estafa Maestra (Master Scam) case that has delved into the disappearance of public funds.

No Chinese Money will Fund Dos Bocas, says Nahle

Minister of Energy Rocío Nahle has denied reports that Chinese money will be used to fund the government’s Dos Bocas refinery construction.

The minister said reports that the refinery would receive some US$600 million (MX$1.12billion) from Chinese banks is not true. Up to this point, the entire project has been funded by federal resources, she said-

Mexican Sovereign Debt Rating Downgrade Could Have Consequences for PEMEX

The Chief Economist for Mexico and Canada at the Bank of America Securities says Mexico’s sovereign debt rating is likely to be downgraded this year and that PEMEX’s debt rating would likely suffer as a result.

Carlos Capistran said the bank believes one of the three major credit ratings agencies will downgrade Mexico’s sovereign debt rating, but that the investment rating will likely go untouched. This is due to Mexico’s poor economic growth outlook. However, Capistran noted that if Mexico grow by more than 1 percent  this year, agencies may be forced to reconsider any ratings cut. 

CNH Gives PEMEX Exploration Funding Greenlight

The National Hydrocarbons Commission has approved US$495million (some MX$9.27billion) for three of the nine expected exploration plans in PEMEX’s Chalabil block.

Chalabil is a shallow water area off the Tabasco coast and one of the priority fields earmarked by PEMEX for development in last year’s business plan. The NOC believes that up to 177MMb could be present there.

PEMEX Priority Field Production Falters

The national oil company produced oil from only four of the 22 priority fields it marked out in last year’s business plan, spending only 6.7 percent of the investment it had expected to do so.

At the end of 2019, PEMEX was producing 6Mb/d from four of its priority fields; Ixachi, Chocol, Cibix and Xikin, though Ixachi has been producing since 2018. This represents only 38 percent of the intended production rate and required MX$2.86 billion (some US$15.7 million) of the MX$42.46 billion (US$226 million) that has been set aside for developments.

IEnova’s Commitment to Mexico Rises

Mexican energy EPC IEnova is set to increase its hydrocarbon storage in the country to 10MMb by 2021 after being awarded the Topolobampo terminal contract at the end of 2019. The new terminal will bring IEnova’s storage capacity to half that of PEMEX.

The new terminal, in the state of Sinaloa, will have a top capacity of 1.6MMb intended to store regular and premium gasoline, and diesel.  Chevron and Marathon Petroleum, are set to be two main clients and expect the terminal to be in use by the end of 2020.