What AMLO’s energy policy will mean for Mexico’s upstream sector Report

Insight 20 August 2018

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Report summary

Mexico's President-elect Andres Manuel Lopez Obrador (AMLO ) has moved quickly to lay down the early markers of his energy policy. His key energy sector appointees suggest a more nationalistic energy strategy. Under his administration, we believe the pace of entry opportunities could slow, with a higher priority placed on Pemex JVs. At the same time, AMLO's ambitious plans to raise crude production to 2 million b/d by 2024 will require the private sector. Strengthening of Pemex will be key to the new administration but it may come at the expense of greater debt for the company.

Executive summary
Entry opportunities for IOCs will slow
- Licensing rounds
- Pemex joint venture programme
- Pemex Round Zero acreage
Regulatory reform hangs in the balance
- Existing contract review
- CNH independence
- Future contract terms
A healthy long-term production outlook needs the private sector
- Short-term turnaround
Will greater state control of Pemex support company reform?
- Government control increasing
- Fiscal reform needs to continue
- How will the government boost the Pemex budget?
What's next?