Oxford Business Forum highlights the impressive progress of Mexico's energy reform post the Elections.

The Oxford Business Forum, held in Mexico City on 12 July, provided some interesting insights into Mexico's energy output and the progress made by the previous Government's energy reform in the weeks after the election of President Elect, Andres Manuel Lopez Obrador (AMLO). Below are they key takeaways from Austrade's attendance at the Forum with the full report attached.

• Energy
• The energy reform to date has secured 107 new contracts, representing 138 new exploration wells (64 of those are offshore wells).
• Oxford Business claims that exploration has doubled in Mexico thanks to the reform. Today there are 76 oil operators, 35 of those are Mexican (newly created companies). Prior to the reform the only operator was the State Owned Enterprise (SOE) Pemex.
• Natural gas is Mexico’s preferred new energy, as the country is changing its energy mix. Natural gas consumption is growing but 85% of which comes from the USA. This is the world’s cheapest gas, which translates into the same industrial electricity prices on both sides of the border.
• However, Mexico must overcome the current gas supplier concentration by increasing local gas production. Tamaulipas region is key to this. Gas allows cleaner generation and also energy storage (However Mexico lacks sufficient energy storage infrastructure).
• PEMEX was given the best oil fields during the “round zero” of the energy reform, but it was not given all the tools it needed to grow, especially capital sources.
• Energy experts suggests that President Elect Lopez Obrador (AMLO) should reform PEMEX so that it copies the Chinese model whereby CNPC created a subsidiary PetroChina. Petro China is 87% owned by the Government and the rest is in the stock market which provides the company with access to capital.

Austrade's team in Mexico City can assist with further insights, market entry and opportunity deleivery.