Mexico 2013 Blog: Pemex Director General Emilio Lozoya on Modernizing Pemex

By
Carin Zissis

What steps is Mexico's state energy firm taking to become more competitive? Pemex Director General Emilio Lozoya provided an overview at our 2013 Mexico City conference.

What steps is Mexico's state energy firm taking to modernize? Pemex Director General Emilio Lozoya provided an overview at our 2013 Mexico City conference.

But first he began with an overview of the North American energy landscape, stressing development of non-conventional energy sources in the United States and Canada and the U.S. moves toward self-sufficiency in the field of hydrocarbon. With a changing paradigm, he said new energy politics were emerging centered on competitiveness. Lozoya indicated this would mean differences in prices for gas between regions; Mexican importation of gas; and more, cleaner, and cheaper energy.

Focusing in on Pemex, Lozoya said Pemex's production is not only no longer declining, but beginning to grow. He mapped out the evolution of crude oil production, including new areas being developed for the future—from deep-water exploration to development of shale gas.

Lozoya sought to dispel myths about Pemex as well, saying that it is competitive and profitable. He also argued that, while some argued that focus should be on quality over quantity when it comes to making the firm profitable. He stated that more is needed than simply fiscal reform to make Pemex viable, and that Mexico would benefit from engaging the private sector in the energy industry.

He also outlined challenges for the oil industry, and steps being sought to leap hurdles by building transparency and reducing administrative costs. In particular, he said Pemex is in discussion about how to reform its pension systems, which he called "archaic" and pointed out they allow workers to retire at the age of 55 with a full pension.

Watch his full remarks here (starts at 3 mins 31 seconds):