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Mexico: Historic Reform of Petróleos Mexicanos (PEMEX) and Approval of Renewable and Sustainable Energy Bills

(Nov. 6, 2008) Three important bills – on the reform of Reform of Petróleos Mexicanos (PEMEX), on renewable energy, and on sustainable energy – were recently approved by the Mexican Congress. They will become law after their official publication in DIARIO OFICIAL, the official gazette of the Federal Government of Mexico.

In an address to the nation on the day of the reform bill's passage, President Felipe Calderón congratulated Mexican legislators for having approved Pemex reform, the reform bill was adopted by the Chamber of Deputies on October 28, 2008, after having been previously approved by the Senate. Calderón called the reform historic, because it is deemed to be the most important overhaul in the field of Mexican energy legislation since 1938, when the petroleum industry was nationalized. The President made the following further points:

First, Pemex will not be privatized. Petroleum is an emblem of Mexico's sovereignty and has been vital for the country's development. From the outset, the aim of the reform was to strengthen Pemex as a public enterprise owned solely by Mexicans, and the reform was approved by the legislators to preserve it as such, respectful of the Constitutional mandate and the will of the Mexican people to keep ownership of oil solely as a national property.

Second, the reform will strengthen Pemex's capacity for petroleum and natural gas exploration and drilling, particularly in regions of difficult access, such as the Chicontepec Basin, the areas of deposits along Mexico's borders, and the Gulf of Mexico. This will allow Mexico to increase its hydrocarbon reserves. The reform will make it possible to address sensitive issues, such as Pemex's operations. More resources and surpluses from revenue, will enable the company to obtain the most advanced technologies and explore new petroleum reserves. Pemex will have sufficient autonomy to decide on its investment projects, a more flexible and efficient hiring process, and an increased capacity of operations to carry out large-scale projects. According to Calderón, this will considerably stimulate the creation of jobs and in particular help provide new opportunities for Mexico's youth.

  • The reform will strengthen Pemex's system of making purchases from national industries and businesses, which will boost the creation of jobs by Mexican provider companies.
  • The reform will bring about, for the first time in 30 years, the construction of a new refinery funded in the first year by 12 million pesos (about US$930,000), which, Calderón stated, will generate thousands of direct and indirect jobs, thereby strengthening the national economy.
  • Through increased wealth from petroleum that may be achieved through the reform, Mexico will have the resources to build more schools, health clinics and hospitals, highways, bridges, potable water networks and drainage, and houses and social programs to combat poverty.

Third, the reform will make Pemex more transparent and accountable to the public. The original legislation submitted by the government was amended by the Congress to establish new instruments that will substantially change the way in which Pemex manages and accounts for its resources. In addition:

  • Pemex's management will incorporate independent, professional advisers who will be in charge of monitoring the company's performance, to ensure that the company works with efficiency and transparency.
  • There will be more efficient mechanisms to combat corruption.
  • Citizen's Bonds, created under a separate bill approved by the Congress, will enable Mexicans for the first time to invest in Pemex and directly receive part of the gains that the firm generates.
  • Any citizen will be able to access information on how Pemex's resources are spent and what they are spent on.

Calderón also noted that the legislators approved two other important statutes, the Law for the Use of Renewal Energies and the Law for the Use of Sustainable Energy, that will enable Mexico to promote the generation of energy from sources that do not pollute, such as water, wind, and the sun and to save energy, thereby conserving natural resources for the benefit of future generations. (Press Release, Presidencia de la República, Mensaje a la Nación del Presidente Felipe Calderón, (Oct. 28, 2008), available at; see also Mexico: Energy – Energy Reform Bill Submitted, GLOBAL LEGAL MONITOR, Apr. 2, 2008, available at //