Mexico Moves To Change Constitution To Undo Energy Reform Put In Place Just A Few Years Ago -- September 9, 2020

Link here.

Mexico will present a set of infrastructure projects in the energy sector where private companies will be invited to participate, while it prepares to undo the energy reform conducted by the previous administration.

Mexico will announce a set of infrastructure projects before Sept. 15, when Mexicans celebrate Independence Day, President Andres Manuel Lopez Obrador said Sept. 7. The joint plan between the government and the private industry to reactivate the economy had originally been announced in November.

According to a presentation filtered to the press, which presumably originated in the office of the presidency, the government's announcement will consist of 168 projects worth roughly $44.4 billion where the private industry will provide over 50% of equity.

The announcement comes at a time when lawmakers from the president's party prepare to discuss a series of changes to the constitution that would effectively undo the energy reform carried out by former President Enrique Pena, which opened up the sector to private investment after over seven decades of monopoly.

Remember, foreign companies -- you know, those companies with the equity and know-how need not apply.

Meanwhile, the same story that has been circulating for quite some time now, Bloomberg is posting it again: Mexico is cutting Pemex' s oil output forest in latest setback.

Mexico is cutting its 2021 forecast for oil production at Petroleos Mexicanos by 8.4% as the state producer struggles under a $107 billion debt load and the impact of the deadly coronavirus.

The country’s Finance Ministry lowered its preliminary estimate for output next year to 1.857 million barrels a day, down from 2.027 million in an April forecast, according to a draft of next year’s budget proposal obtained by Bloomberg News.

Pemex, as the company is also known, has been hit hard by Covid-related deaths among its workers at a time when the oil-market crash only made the ambitions of Mexican President Andres Manuel Lopez Obrador to increase production more difficult.

Even the revised output number looks “optimistic,” said [one analyst]. “It seems that they have not learned,” he said, predicting that Pemex will fail to meet the lower target.

The Finance Ministry estimates oil prices will average $42.10 a barrel next year, up from a preliminary forecast of $30 a barrel at the start of April. The numbers are part of a budget proposal that would increase Pemex’s spending by just 0.6% next year, to 544.6 billion pesos ($25 billion).