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 Business News | March 2008 
Mexico Marks Oil Nationalization Anniversary with Country Divided Over Reforms
 Olga R. Rodriguez - Associated Press
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| | Mexico marks the 70th anniversary of its oil industry's nationalization amid a heated debate between those who oppose private investment in the state oil monopoly and those who consider it necessary to boost sagging production. (Associated Press) | | |
Mexico City – Mexico marked the 70th anniversary of its oil industry's nationalization Tuesday amid a heated debate between those who oppose private investment in the state oil monopoly and those who consider it necessary to boost sagging production.
Speaking to oil workers in the oil-rich Gulf coast state of Tabasco, President Felipe Calderón announced plans for a new refinery to reduce the country's dependence on imported petroleum products, including gasoline.
“The challenge for all Mexicans is to transform Pemex so it becomes a more efficient and stronger company that is less dependent on foreign imports,” he said.
Calderón is pushing an energy reform proposal that would allow private companies to form partnerships with state-owned oil company Petroleos Mexicanos, or Pemex, to explore deep-water oil fields and boost sagging production.
Pemex's production has been steadily declining, falling 5.3 percent to an average 3.1 million barrels a day in 2007 – primarily due to plunging output at its biggest-yielding field, Cantarell.
Cantarell's output will drop by as much as 20 percent this year as the field matures, producing 1.2 million to 1.3 million barrels a day compared to an average 1.5 million barrels a day in 2007, Pemex projections show.
Experts believe there is much more oil to be found in deep waters in the Gulf of Mexico. But Pemex now lacks the technology to access it, prompting Calderón and others to suggest the company bring in private firms for some form of joint projects or strategic alliances.
While Calderón has not yet made any formal proposal to do that, the very idea of loosening the government's grip on the energy sector is a sensitive subject, as many politicians and much of the public revere the state-run oil monopoly with nationalistic pride.
In Mexico City, former Democratic Revolution Party presidential candidate Andres Manuel López Obrador has said that opening Pemex to private investment would threaten national sovereignty, and has accused Calderón's administration of seeking to privatize the entire oil industry – a charge the president denies.
Thousands of López Obrador supporters gathered Tuesday in the capital's central square to “defend” the nation's oil, and has threatened to lead nationwide protests against any reform.
Mexico, the world's sixth-largest oil producer and a top foreign supplier of crude to the United States, relies heavily on U.S. refineries and imports about 20 percent of the natural gas it consumes.
Mexico nationalized its oil industry on March 18, 1938, a day commemorated each year with patriotic fanfare. Its constitution bans most private and foreign involvement in the sector, but in practice, the government has eased the restrictions slightly in the past 15 years, allowing Pemex to subcontract some work to private company. |
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