Mexico’s National Action Party presented a bill to Congress today to change the constitution, paving the way for Petroleos Mexicanos to sell shares to the public, according to the opposition party’s top member on the Senate Energy Committee.
The changes would require additional legislation to enable a “small” share sale, Salvador Vega said in a telephone interview from Mexico City today. The proposal would also break the monopoly on electricity generation and distribution held by state power company Comision Federal de Electricidad, or CFE, he said.
The PAN is proposing the most “audacious” changes in Mexico’s energy industry since 1938, when Mexico expropriated assets from U.K. and U.S. companies and changed its constitution to assert control over its energy resources, Vega said. The proposal may go beyond that of President Enrique Pena Nieto of the Institutional Revolutionary Party, or PRI, who last month declined to say whether he’ll push to change the constitution and has promised to “modernize, not privatize” Pemex.
“We’re looking for a way to democratize Pemex, including listing small amounts of shares,” Vega said. “We’re also contemplating an opening for the electric sector.”
The peso briefly pared its loss after Vega’s comments, before falling 0.7 percent to 12.8496 per U.S. dollar at 11:30 a.m. in Mexico City.
The PAN’s announcement preempts the energy proposal by the ruling Institutional Revolutionary Party.
David Penchyna, the head of the Senate Energy Committee and a member of the PRI, said in an interview today with Radio Formula that the party’s energy initiative will be presented within days.
When asked about the possibility of a share sale at a news conference today, PAN lawmaker Ruben Camarillo said the proposal would call for annual Congressional approval of Pemex’s debt levels and capitalization strategy.