Page 19: of Offshore Engineer Magazine (Aug/Sep 2013)

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Perspectives

Analysis

Energy reform in Mexico:

Is it time?

By Jose Valera and Gabriel Salinas

Total Mexican oil production 4,500 resident Enrique Peña Nieto recently announced that he will send a “transformational” energy reform bill 4,000 to Mexico’s Congress in the coming months in an

P 3,500 effort to attract the private capital and expertise required to develop Mexico’s deepwater and shale deposits, and reverse 3,000 the country’s declining energy production.

2,500

Although companies have been providing oil-related services to Pemex, Mexico’s state-owned national oil 2,000 company, for several decades, private investment in 1,500

Thousand bbl/d

Mexico’s upstream sector has been absent since the coun- try’s oil industry was nationalized in 1938. The absence of 1,000 such investment is due to constitutional limits on private 500 involvement in the exploration and production of hydro- 0 carbon resources. Such restrictions, together with Mexico’s 198019841988199219962000200420082012 massive Cantarell oil feld discovery in the late 1970s,

In 2012, Mexico produced an average of 2.94MMb/d of total explain the very limited investment and attention to explo- oil liquids, down from a peak of 3.85MMb/d in 2004, a 23.6% ration activities in Mexico. decline in production in one decade.

Source: U.S. Energy Information Administration.

In recent years, Mexico has experienced signifcant oedigital.com August 2013 | OE 21 021_OE0813_Analysis.indd 21 7/22/13 12:22 AM