Pemex
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Petróleos Mexicanos
<tr><td colspan="2" style="text-align:center; padding:16px 0 16px 0;"> | |
| Type | Government-owned corporation |
|---|---|
| Founded | 1938 |
| Headquarters | HQ in Mexico City, Mexico
<tr><th style="text-align:right; padding-right:0.75em;">Key people</th><td>Jesus Reyes Heroles (CEO) |
Petróleos Mexicanos (PEMEX) is Mexico's state-owned, nationalized petroleum company.
Asphalt and pitch had been worked in Mexico since the time of the Aztecs. Small quantities of oil were first refined into kerosene around 1876 near Tampico. By 1917 commercial quantities of oil were being extracted and refined by subsidiaries of the British Pearson and American Doheny companies, and had attracted the attention of the Mexican government who then claimed all mineral rights for the state as part of its Constitution.
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[edit] Expropiación Petrolera
In 1938, President Lázaro Cárdenas sided with oil workers striking against foreign-owned oil companies for an increase in pay and social services. On March 18 President Lázaro Cárdenas embarked on the state-expropriation of all resources and facilities, nationalizing the U.S. and Anglo-Dutch operating companies, creating PEMEX. In retaliation, many foreign governments closed their markets to Mexican oil. In spite of the boycott, PEMEX developed into one of the largest oil companies in the world and helped Mexico become the sixth largest oil exporter in the world.
[edit] Products
PEMEX is the sole supplier of all commercial gasoline (petrol/diesel) stations in Mexico. All petrol stations, although labeled PEMEX, are concessions that are strictly full-service. PEMEX tried to take away the concessions from a large number of these for low-quality gasoline (oftentimes cut with up to 40% fuel oil) and for not serving the correct amount of gasoline (many serve only 9 litres for every 10 registered on the pump), however a judge ruled these were "not reasons to take away the concessions".
The grades of PEMEX gasoline are 'Magna' (Regular Unleaded 87 octane - green pump handle) and 'Premium' (92 octane - red pump handle). Previously, PEMEX offered a leaded gasoline called 'Nova,' but this has been discontinued for environmental reasons (Nova gasoline, like many other leaded gasolines, have been discontinued due to stringent health regulations).
Although PEMEX accepts Mexican Pesos and U.S. Dollars (and fills vehicles in liters), the gas is charged in pesos. In November 2005 it was decided that a tax invoice for gasoline would only be issued when payment was made by credit card. However, not all stations are able to process credit card payments.
[edit] Controversy
Customers have complained about the alleged fraud committed by some gas stations, which consisted in selling "liters" of less than 900ml (leading to some to refer to these "liters" as "chiquilitros"; i.e. "partial liters"). Pemex is not responsible for such frauds and has been recently taking measures to counter this problem.
[edit] Accidents
On June 3, 1979, PEMEX's Ixtoc I exploratory oil well in the Gulf of Mexico, about 600 miles south of Texas, suffered a blowout and became the largest unintentional oil spill in history.
On November 19, 1984 a series of explosions at the PEMEX petroleum storage facility at San Juan Ixhuatepec in Mexico City ignited a major fire and killed about 500 people.
On 22 April 1992, explosions in Guadalajara killed more than 200 people.
[edit] Reserves
In November, PEMEX announced the discovery of possible reserves that may total 200 million bbl. of oil in the deep waters of the Gulf of Mexico. Yet independent oil analysts point out that extensive seismic studies and test wells will be needed to confirm the area's true potential, and PEMEX has neither the financial resources nor the technical expertise to carry out those follow-ups on its own.
An article in the quarterly magazine of the International Monetary Fund in 2001 used PEMEX as an illustration of a broader point about the securitization of future flow receivables. The authors noted that between January 21,1999 and March 29,2000, the mean spread on the 7 year bonds issued by PEMEX, the state-owned oil company, was 309 basis points, with a standard deviation of 63. But the mean spread on the bonds of the United Mexican States maturing in 2026 was 372, with a standard deviation of 79. Unsurprisingly, then, investors prefer secured debt to unsecured sovereign from emerging market countries.
[edit] Current situation
PEMEX, despite its current $77 billion in revenue, pays high taxes that contribute with a large portion of the budget of the federal government. Indeed, in recent years the company has only been able to make ends meet through massive borrowing, so that it now owes a staggering $42.5 billion, including $24 billion in off-balance-sheet debt because the Mexican government treats the company as a major source of revenue. The state-run company pays out over 60% of its revenue in royalties and taxes, and those funds pay for a third of the federal government's budget. If oil prices drop or there are no major new discoveries of crude, that could spell big trouble for PEMEX despite its immense revenue stream and expansion prospects. However, in 2005, with record-breaking oil prices (due to the Iraq war, economic expansion of the United States and China) the company has seen an unexpected excess of funds. This tendency continued in 2006, but these funds have been used to pay salaries of bureaucrats and current costs, instead of being invested in projects of exploration and production; during President Fox administration, these funds represent around 70 billion dollars<ref>http://www2.eluniversal.com.mx/pls/impreso/noticia.html?id_nota=53687&tabla=finanzas</ref>, yet the administration says there is not enough money to pay the debts. To help capitalize the company President Fox has brought forward the possibility of making shares of PEMEX available to Mexican citizens and pension funds, to complement a current project-specific investment setup known as "Proyectos de Inversión Diferida En El Registro del Gasto" or PIDIREGAS<ref>http://www.pemex.com/index.cfm?action=content§ionID=11&catID=117</ref>; this proposal, along with alleviating PEMEX's heavy tax burden and a substantial budget increase, have met opposition in Congress.<ref>http://www.businessweek.com/magazine/content/04_50/b3912084_mz058.htm</ref><ref>http://query.nytimes.com/gst/fullpage.html?res=9C06E4DA1731F931A35750C0A9609C8B63</ref>
[edit] References
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[edit] External links
de:PEMEX es:Petróleos Mexicanos fr:Pemex nl:Petróleos Mexicanos
