Question marks appeared over the administration’s plan to support PEMEX this week as economists and banking experts cast doubt on the long-term reliability of the government’s debt-payment intentions. Former CFE Director Enrique Ochoa offered his insight into the pipeline stoppage row between AMLO’s government and several pipeline constructors while Shell opened its first training center.

For a look this week’s major stories in Mexico’s oil and gas industry, read on!

This week’s Interview of the Week is with Andres Garcia Business Development Manager for Ampelmann Operation. Ampelmann is an international company providing offshore access solutions to over 200 projects worldwide.

Experts’ Concerns for PEMEX Financing

Experts from the Center for Economic Budgetary Research (CIEP) have cast doubt over the financing that the Mexican government intends to give PEMEX to bolster the NOC as it struggles to deal with its heavy debt. Economics experts suggested that lower national growth will hamper tax revenue and potentially unbalance the nation’s books.

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PEMEX Funding a Short-term Solution

Meanwhile, banking experts have questioned the long-term viability of using the Mexican Budgetary Income Stabilization Fund (FEIP) to pre-pay on PEMEX’s debt. Specialists suggest that the government’s proposed use of FEIP will work in the short term but does not offer a viable long-term solution. Additionally, pre-paying the debt will not change the NOC’s credit rating.

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Ochoa Wades in on Pipeline Row

The former CFE boss, Enrique Ochoa, has given his say on the disagreement between the Mexican government and several major pipeline constructors, in which contracts have been frozen and accusations thrown over the integrity of pipeline construction contracts.

Ochoa told radio broadcaster, Radio Fórmula, that the government is obliged to pay pipeline constructors, including IEnova, TransCanada and Carso, for the “force majeure” stoppage of the pipeline contracts. But, as a consequence of this, the government has the right to free natural transport for however long it pays for the stoppage.

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Shell Pushes for Local Content

Royal Dutch Shell has opened its first training center in Naucalpan, in the north of the Mexican capital, Mexico City. Murray Fonseca, Shell’s Latin America Sales Director, said the new training center will give staff the necessary skills and knowledge, including customer service and security regulations, needed to operate gas stations in the newly liberalized downstream sector.

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