Pemex Plan to Reverse Oil Drop, Balance Budget Fails to Impress
- Mexican driller will focus on shallow-water, onshore fields
- Pemex to invest 58 billion pesos in its refineries this year
Photographer: Susana Gonzalez/Bloomberg
Mexico’s Petroleos Mexicanos announced plans to balance its budget by 2021 and reverse a decade and half of declining crude production as early as next year. The peso and the company’s bonds weakened on skepticism that the strategy to achieve those goals will be effective.
Under the presidency of Andres Manuel Lopez Obrador, Pemex will invest 1.95 trillion pesos ($102 billion) by 2024, the state-owned oil producer said in an e-mailed document on Tuesday ahead of the release of its full business plan. Of that amount, 269 billion pesos between 2020 and 2022 will come from tax breaks and government allocations. Another 108 billion pesos through 2023 is expected to come from so-called integrated exploration and extraction contracts, a new type of service contract for drilling, Pemex said.