Page 4 - LatAmOil Week 41 2021

COMMENTAR
LatAmOil COMMENTARY Y LatAmOil

Tula refinery (Photo: Presidencia de la República Mexicana)

A tale of two protests

Demonstrations near the sites of two refineries highlight the problems of Mexico’s downstream sector

PROTESTS have erupted near the site of two unique, in that Mexican teachers have been stag-
Mexican refineries within the last few weeks, ing similar actions at multiple location around
WHAT: derailing regular operations and spurring con- the country in recent weeks. However, they did
Protests have forced cerns about fuel supplies. have newsworthy consequences, in that they
Pemex to halt processing These developments are not related. The forced a shutdown of the Tula refinery. The plant
at the Tula refinery and demonstrators at the two sites are motivated by has now been offline for more than two weeks.
halt construction at the different concerns, and the refineries themselves Pemex has had little choice but to suspend
site of the future Dos are not facing comparable conditions. (One of operations, given that protesters have been
Bocas refinery. them, the Tula refinery in Hidalgo State, is an blocking roads that lead to the 315,000 barrel
established facility and has been in operation per day (bpd) refinery and a railway line to the
WHY: for some time. The other, the Dos Bocas plant port of Michoacan, thereby preventing it from
Recent events are in line in Tabasco State, is still under construction and sending its fuels to market. The NOC did ini-
with ongoing challenges
in the downstream sector. not likely to come online until next year at the tially try to wait out the trouble by loading petro-
earliest.) leum products into storage facilities. However,
WHAT NEXT: Even so, both protests serve to highlight the blockages have lasted long enough that the
As protests continue, serious problems facing Mexico’s downstream storage tanks have become full. So with no place
Mexican refineries are sector. to put its production, the Tula plant has gone
likely to remain under offline.
strain. Background: Tula
The Tula refinery, owned by the national oil Background: Dos Bocas
company (NOC) Pemex, began experiencing Meanwhile in Tabasco, the protests are focused
problems last month, when local schoolteachers not on an established and operational refinery
began protesting against the government’s fail- but on a site where Pemex aims to build the
ure to pay their salaries and to distribute pension country’s largest oil-processing plant – Dos
payments to retirees on time. Bocas, which will have a throughput capacity of
The demonstrations in Hidalgo State are not 340,000 bpd.

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