The following is the fourth in a series of summaries of each presentation and panel that took place during the Mexico Oil and Gas Summit last Tuesday, July 1st in the Sheraton María Isabel in Mexico City. To download the speaker’s presentations which have been approved for public distribution so far, click here.
Jose Pablo Rinkenbach, Managing Partner of Ainda Consultores chaired a panel with Ernesto Marcos Giacoman, President of AMESPAC, and Cesar Vera Mendez, Area Manager at Nabors Industries, discussing the key factors that will contribute to the success of the private oil and gas companies following the sweeping reforms to the industry.
Rinkenbach opened up the panel with a discussion surrounding the state of the private industry as it stands today in Mexico, presenting facts and figures elucidating the extent of investment. Rinkenbach explained that there are almost 1000 private companies operating within the National Energy sector, 370 of which are dedicated to the well services segment, which makes up 50-60% of the industry’s CAPEX. 20 services lines currently support well construction, and 20 national companies operate within this area. The focus of the remainder of the panel discussion covered what needs to be done to grow the sector and support new companies starting up, particularly national ones.
Cesar Vera Mendez discussed the role of PEMEX in supporting the development of the private sector, saying that the historic monopoly has played the major role in establishing the industry and will continue to be a crucial client. Private companies need to be a part of PEMEX’s procurement projects and therefore the reform and opening of PEMEX practices is key. Vera also purported that going forward what exactly defines a national company needs to be established. “Talking about national content we need to look averages. It is easy to define when you are talking about tangible products, but what about when we are talking about services for example. Corporate structure is also relevant; if a foreign investor decides to start a company by issuing bonds or shares to a local investor, then that can be classified as local content,” Vera said.
Ernesto Marcos Giacoman asserted that what Mexico really needs is a Cemex for oil. In the meantime the Mexican companies that work for PEMEX must increase standards and internationalize so that they can become global actors. Marcos added that Mexico has begun to generate a national database for the companies that provide specific types of services, which the country has not had until now. This will help the financial sector, which currently has no idea of what the industry actually looks like.
All parties agreed that the private sector should not wait for a 3rd party to provide guidance on how to improve human capital but rather start working with the educational and public sector to create the right conditions to support sector growth immediately.