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Why Mexico's Historic Energy Reform Matters

PEMEX Oil Installation

A Pemex offshore oil installation in the Gulf of Mexico. (AP Photo)

June 13, 2014

Mexico is among the world’s top oil producers, but it’s seen oil production hobbled over the past decade, thanks to a need for investment and expertise. By this summer, approval of legislation tied to the country’s energy reform could help change the landscape for Mexico’s energy sector.

As Mexican congressman Javier Treviño recently stated, Mexico’s energy reform is “historic, real, and transformational.” The reform breaks up a state monopoly over energy in Mexico that has existed for more than 75 years. Currently, Petróleos Mexicanos, or Pemex, the state oil company, runs all oil and gas production. In other words, Pemex is the sole exploration and production company; all gas stations in Mexico carry the Pemex brand. Similarly, the Federal Electricity Commission, or CFE, is a state-owned entity that controls all electricity generation and distribution. Pemex and CFE operate as government bodies, not productive enterprises....

Read the full article in U.S. News & World Report's online opinion section.