Calderon Says Mexico Must Act Now to Stop Decline in Oil Output

(Bloomberg) — President Felipe Calderon said Mexico must move urgently to reverse declines in oil output and reserves and proposed allowing foreign and private companies to refine, produce and transport crude.

“We have to act now because we’re running out of time and out of oil,” Calderon said yesterday during a 13-minute, nationally televised speech from Mexico City. He spoke after his party presented an energy reform proposal to the Senate.


Bringing outside companies into Mexico’s oil industry would free up cash that Petroleos Mexicanos, the state oil company, could use for energy exploration. Calderon’s bill doesn’t propose changes to the constitution, which reserves the ownership of oil and gas to the state and bans any accord that would give outside companies an equity stake in oil projects.

“The government made a decision that this is the only type of reform they can handle,” said Daniel Lund, president of consulting group Mund Americas in Mexico City.

Bloomberg