Reuters – Crude oil prices hit their lowest in almost six years on Tuesday in a market readying for further falls, as a big OPEC producer stood by the group’s decision not to cut output to tackle a supply glut.
Bloomberg – More than 10,000 people working at Mexican oil service companies have been laid off as state-owned Petroleos Mexicanos cut contracts in the face of the global slump in crude prices. More job losses are expected.
Most of the companies are based in Ciudad del Carmen, on the Campeche Bay in the Gulf of Mexico, and were told last week that contracts wouldn’t be renewed with Pemex, as the world’s ninth largest oil producer is known.
Job losses could rise to 50,000, Gonzalo Hernandez, secretary at the Ciudad del Carmen Economic Development Chamber, said in a phone interview.
EFE – Spain’s Abengoa has been awarded a $1.55 billion contract to build and operate a 924 MW combined-cycle power plant in Ciudad Juarez, a project that will boost the supply of electricity in northern Mexico.
Reuters – Mexican state power company CFE has awarded a $386.4 million contract to build a 240 Megawatt (MW) hydroelectric power station in southern Mexico to a consortium comprising a unit of China’s Sinohydro Corp.
AP – Mexico’s state oil company wants to import about 100,000 barrels of light U.S. crude a day to mix with this country’s heavier oil as a way to improve refinery processes. While the deal has not gone through, it is raising hackles in Mexico.
Reuters – A consortium including an energy company controlled by billionaire Carlos Slim won a contract to build a 230 km (143 mile) pipeline to supply gas to central, northern and western Mexico.
The Yucatan Times – A new pipeline will soon carry natural gas from fields in the Gulf of Mexico to shipping yards along the Pacific Ocean. Construction of a fleet of ships for the project has begun.
Reuters – Brent crude oil recovered slightly after falling below $50 a barrel for the first time since May 2009 on Wednesday, as traders re-assessed their books after a sharp slide since the start of the year on a growing supply glut and weak global demand.
Sentido Comun – Oil extended its fall to below $50 per barrel due to speculation that crude inventories will continue increase, thereby pushing prices to the lowest level since April 2009.
By Katherine Corcoran / Associated Press
As he heads to Washington on Monday to meet with Barack Obama, Enrique Pena Nieto leaves behind a year that was hardly what he had envisioned.
The Mexican president and his team started 2014 carrying out a slew of newly passed reforms, from breaking up telecommunications monopolies to opening the nation’s energy sector, earning him international plaudits, including a Time magazine cover with his image above the caption “Saving Mexico.”
Then came a 1-2-3 punch of scandals: Soldiers killing 22 civilians in a questionable “shootout”; the abduction and presumed murder of 43 college students, allegedly at the hands of local officials and police in league with a drug cartel; and revelations that Pena Nieto and his treasury secretary live in luxury homes built and financed by a favorite government contractor.
Pena Nieto’s meeting with Obama at the White House on Tuesday comes amid what was supposed to be “Mexico’s moment,” a new era of transparency and reform.
Clean Technica – The city of La Paz is soon going to be powered 100 percent by solar energy. With a 39 megawatt solar power in place, Grupotec is building another.
Reuters – Mexico’s government said on Friday that its latest “gasolinazo,” or gasoline price spike, will be the only increase this year.
Financial Times – While Mexico’s reforms will reshape the country’s energy industry over the next few years, they will also bring about investment opportunities in the energy industry throughout the rest of Latin America.
WSJ – Mexico’s crude oil production fell in 2014 for a 10th consecutive year. Petróleos Mexicanos produced 2.353 million barrels a day of crude oil in December, bringing average output for 2014 to 2.429 million barrels a day, compared with 2.522 million in 2013.
San Antonio Business Journal – Mexico’s historic energy reforms go into effect on Jan. 1, but officials have just released technical documents that outline rules for imports and exports in this new market.
EFE – Spanish infrastructure company ACS said its Dragados Offshore unit built a platform in the Gulf of Mexico for Mexican state-owned oil giant Pemex that will produce oil and gas.
El Dario de Yucatan – Mexico’s energy reform will not harm the ejido system or ejidotarios, said Secretary of Desarrollo Agrario, Territorial y Urbano Jorge Carlos Ramirez Marin.
Reuters – The allure of investing in Mexico’s historic oil sector opening has been dimmed by the plummeting price of crude, putting pressure on the government to offer bigger incentives to private investors in the first major round of contracts up for grabs.
Financial Times – You don’t have to look far to see the impact on Mexico of falling oil prices (now close to a five-year low): just take a look at the trade balance of state giant Pemex . It slumped by half in one month, to $656 million in October from $1.3 billion in September, and that was before the combination of Mexico’s lower production and lower world prices really began to bite.
So now would be a good time to take a cold look at how much damage falling prices could really do to Mexico as it prepares to open up its oil sector to private investment, what Mexico could do about it, what wider impact that could have, and what the US and the International Monetary Fund could do to help.
Bloomberg – Cydsa is diving into new energy opportunities at home. The maker of products ranging from refrigerant gases to acrylic yarn announced a joint venture with Petroleos Mexicanos to store liquefied petroleum gas in a salt cavern for 20 years, at a planned cost of about $130 million.