Crucial Step Toward Foreign Oil Investment Clears Mexican Senate
December 10, 2013
Lorne Matalon
Mexican President Enrique Peña Nieto met citizens for a town hall in Ojinaga, Mexico on Thanksgiving Day. He told his audience that energy reform will be a hallmark of his administration.
Lawmakers from three senate committees in Mexico approved a bill late Monday that would allow U.S. companies like Exxon Mobil and Chevron and others like Royal Dutch Shell in the Netherlands to develop fields in the Gulf of Mexico.
This is part of a process as the state-owned oil monopoly Petroleos Mexicanos tries to reinvent itself after a decade of falling production.
The move, a centerpiece of reform proposed by Mexico President Enrique Peña Nieto, rankles ardent Mexican nationalists who say such a move is a betrayal of Mexican independence.
Opposition lawmakers argued the proposed overhaul will see Mexico lose its sovereignty and control of its energy industry.
Fronteras Desk spoke Tuesday with a Reuters reporter who says, during the vote, one legislator played the U.S. national anthem on his cell phone to illustrate his displeasure with the process.
American and other foreign energy production companies are eagerly awaiting the end of the debate in Mexico as are their shareholders. The entry into Mexico by foreign-owned energy companies is expected to translate into a windfall for those foreign entities.
One prominent oil industry analyst, George Baker in Houston, told Bloomberg the proposal represents a "180 degree turn" in the history of Mexico.
The package approved Monday will be vigorously opposed in the halls of power and on the street where demonstrations against energy reform are taking place every week.
