The three Mexican regulatory agencies overseeing the Mexican energy sector, CNH, CRE and ASEA have released their 2018-2022 strategic plan as well as announcing the creation of Offices for Coordinated Assistance to the Energy Sector (ODAC). The strategic plan and offices were developed on the basis of the recommendations of the OECD report “Driving Performance of Mexico’s Regulators.”
Each of the regulators will have an ODAC that will assist interested parties in those processes requiring the intervention of more than one of the regulators. Initially these processes will be: approval of exploration plans, approval of extraction plans, approval for drilling wells, sale to the public of petroleum liquid gas, sale to the public of oil derivative products and the transport of natural gas through pipelines.
The complexity of the permitting process and ensuing delays have been one of the principal complaints of new entrants into the Mexican oil and gas market and the ODACs seem to be a step toward resolving these issues. Coordination between Mexico regulatory agencies in general was one of the main focuses of the OECD report, which advocated for the creation of an Energy Regulatory Group to catalyze information sharing and facilitate coordination among the different regulators.
The regulators’ strategic plan is built around five goals: facilitating the development of the energy sector, offering long-term regulatory certainty to the energy sector, systematic operation to meet the needs of the sector in a coordinated manner, the promotion of cutting-edge financial and technical capacity permitting the operation of the system and recognition as a benchmark by society as well as national and international markets.
The continuity of the regulatory system beyond the elections in 2018 is one of the key areas of uncertainty the industry faces and the OECD report contains recommendations that would give greater autonomy and freedom from political contingencies such as the extension of budgetary autonomy.