Page 7 - LatAmOil Week 31 2021

LatAmOil MEXICO LatAmOil

Under the agreement, it added, CFE will also planned to address these concerns, but Reuters
redouble its efforts to give TC Energy the sup- noted that Mexican President Andres Manuel
port it needs to complete a planned gas pipe Lopez Obrador had suggested shifting the route
from Tuxpan to Tula, a city north of the capital of the pipeline.
in Hidalgo State. “The CFE has agreed with TC The agreement will also serve to consoli-
Energy that it will take a more active role that date TC Energy’s contracts in central Mexico,
will allow for solving social conflicts and com- CFE said in its statement. It did not divulge any
pleting the Tuxpan-Tula pipeline,” it stated. details of the consolidation plan but declared
Work on the 286-km link has been sus- that the arrangement would generate signifi-
pended for some time, owing to concerns that cant savings for the Canadian company, which
the conduit will cross lands that some host com- renegotiated its Mexican contracts in 2019 at the
munities view as sacred. CFE did not say how it behest of the government. ™

Mexican government will review Pemex’s

pledge to preserve refinery building site

MEXICAN President Andres Manuel Lopez environmental lawyers consulted by Bloomb-
Obrador has said his government will review erg, the commitment is still valid.
the promises made by the national oil company Pemex is building the Dos Bocas refinery at
(NOC) Pemex to refrain from developing an the behest of the Mexican president, who sees
area that includes the site where the Dos Bocas the project as an engine of economic growth and
refinery is being built. a means of reducing dependence on imported
Responding to a question from Bloomberg petroleum products. Some observers believe,
at his daily press conference on August 3, Lopez however, that the 340,000 barrel per day (bpd)
Obrador said he was tasking Energy Minister oil-processing plant will act as a drag on the
Rocio Nahle with looking into the matter. “I economy because of rising costs. Lopez Obra-
promise that she will attend to you and give you dor had originally said he expected the cost of
the information,” he declared. building the plant and bringing it on stream by
He also noted that Pemex might be penal- mid-2022 would be around $8bn, But Pemex
ised if Nahle determined that the state-owned later revised the figure upward to $8.9bn.
company had violated a previous conservation Then in its latest annual report, published
pledge. Nevertheless, he said he expected gov- earlier this year, the NOC said that the price tag
ernment experts to rule in the company’s favour. might be as high as $12.4bn. It also indicated
Questions about the status of the refinery that the refinery would not be able to start com-
construction site arose last week, after Bloomb- mercial operations in mid-2022 as planned. In
erg reported that Pemex had promised to refrain the best-case scenario, it said, the facility may be
from building within a specific area that is home able to launch trial runs and test production by
to many unique species of plants and animals for that date but will not be able to do more.
20 years. In exchange, the NOC obtained per- Under these circumstances, Pemex com-
mission to drill for oil and gas in a nearby section mented, the business case for the Dos Bocas
of Mexico’s offshore zone. refinery may have to be revamped. “[It] will be
The company made its pledge in 2007 and necessary to reformulate the project, in particu-
spelled it out in documents that have not been lar the internal rate of return and the net present
made public until now. According to four value,” the company said in its annual report. ™

The Dos Bocas refinery is being built in Tabasco state (Photo: LopezObrador.org.mx)

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