Interview : Carlos Treviño Medina
How is Pemex adapting to the new energy reform?
CARLOS TREVIÑO: The energy reform has initiated a profound transformation of the legal and institutional framework of the Mexican energy sector as it seeks to promote the sustainable and efficient use of our natural resources to ignite the sector’s potential and contribute to the country’s overall development. As mandated by our business plan, Pemex is concentrating its efforts in businesses that will result in greater profitability and a more efficient use of our resources. At the same time, we are looking to strengthen our alliances with the world’s leading oil companies in order to increase our knowledge and broaden our use of innovative technologies. Lastly, we want to maximise the benefits of the energy reform by ensuring that the wealth of our subsoil is sustainably managed – not just through the transition process, but for generations to come.
What impact will the Ixachi deposit have on the company’s financial position in the medium term?
TREVIÑO: Appraisals are currently being carried out following the discovery of the Ixachi field in Veracruz at the end of 2017. These evaluation activities include an extended production test in the Ixachi-1 well and the drilling of the Ixachi1DL boundary well. The drilling of the Ixachi-1001 well is also under way to verify the existence of deeper deposits. Additionally, the Cruver-1 well is in the exploration phase, verifying how far south the deposits extend, as well as evaluating the total potential commercial accumulation of hydrocarbons. The information from these wells will provide further economic certainty about the commercial viability of these reserves, thereby defining the long-term development plan of this important discovery.
In what ways will Pemex cooperate with other companies on exploration and development?
TREVIÑO: We are always looking for ways to establish strategic partnerships with the largest players in the sector globally as this allows us to meet our goal of ensuring fiscal balance and profitability. We therefore are seeking partnerships that allow us to bolster our exploration and production activities.
Recently, Pemex signed contracts for the extraction of hydrocarbons in the Cárdenas-Mora and Ogarrio fields with Petrolera Cárdenas Mora (Cheiron Holdings) and Deutsche Erdoel México. The Cárdenas-Mora and Ogarrio terrestrial farmouts generated an income of around $540m, and it is estimated that they will attract overall investments of more than $1.5bn.
These projects represent just a handful of the 16 associations that Pemex has made through rounds, farmouts and migrations. Therefore, it seems that strategic alliances are the most appropriate way for us to share risks and increase the profitability of the company. This model is the future for Pemex, as it is for many of the world’s largest energy companies.
To what extent will multilateral cooperation mechanisms combat the theft of hydrocarbons?
TREVIÑO: Since 2016 an interdisciplinary work group, led by the minister of finance, has been formed to tackle this issue. The participants come from the Ministry of Finance and Public Credit, the Attorney General’s Office, the Tax Administration Service and the Armed Forces, alongside Pemex. This group analyses the different methods of theft and the illegal sale of hydrocarbons using databases of information and implements strategic responses on a case-by-case basis.
It has achieved good results thus far, with more than 2200 people involved in such activities detected between January 2017 and March 2018. In addition, more than 6600 vehicles have been secured and over 15m litres of stolen fuel recovered. However, room for improvement remains. The group is reinforcing its strategies and improving its coordination efforts to have better results, and combat this crime that causes a significant amount of damage to Pemex and Mexico.
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