News Post
CERAWeek ’15: Pemex CEO sees downstream as lucrative for investments
By Ben DuBose
Online Editor

HOUSTON -- The CEO of Mexican energy major Pemex believes the downstream and midstream industries will offer significant opportunities for foreign investment on the heels of the country's massive energy reform program.
Emilio Lozoya Austin, CEO of Pemex, said the current period of implementing Mexico's reforms is the most exciting time for his company since its inception. He spoke in a panel session at the annual IHS CERAWeek conference.
"Pemex is in the process of modernizing itself to maximize its economic value, and changes being made to its corporate structure are transforming it into an agile company with a more businesslike structure," Lozoya said.
Lozoya noted that the national energy reforms are on schedule because of the "commitment and clear vision" of the president of Mexico and the Mexican government.
Lozoya referred to a recent partnership between BlackRock and First Reserve in the midstream sector as the "first large step" by Pemex to bring in strong partners, saying that deal is a symbol of what Pemex plans for the future.
The major milestones over the next year for Pemex will be bid rounds this summer, the development of new partnerships, and the establishment of contracts to meet international standards, he said.
Lozoya also said the energy reforms should help the North American oil and gas market to become more integrated. For example, Mexico is currently in talks with the US
to engage in swaps of heavy and light oil assets, which Pemex would then use in its refineries.
Lozoya said those talks with the US appear to be going well, and if the petition is granted, Mexico's relationship with the US could end up similar to the current arrangement between the US and Canada.
Lozoya identified cash flow as Pemex's primary challenge, stemming from its declining production base in Mexico. However, with the selection of quality partners, he believes the company will be able to maintain its existing operations and address its technical challenges.
The IHS CERAWeek conference continues through Friday at the Hilton Americas in downtown Houston.
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