May 11, 2011 / 1:16 AM / 7 years ago

UPDATE 4-Mexico's Calderon eyes oil reform, rejects Pemex IPO

 * Calderon says would like to try second oil reform
 * Says goal is to make Pemex more like Petrobras
 * Calderon says no plan to sell shares any time soon  (Updates with Calderon rejecting share issue)
 By Robert Campbell
 MEXICO CITY, May 10 (Reuters) - Mexican President Felipe Calderon said on Tuesday he hoped to attempt a second reform of state oil monopoly Pemex before the end of his term in 2012 but dismissed the chances the company could soon sell shares.
 Calderon said in an interview with Bloomberg TV that he believed a further reform to make Pemex [PEMX.UL] more efficient like other state controlled oil companies, such as Brazil’s Petrobras (PETR4.SA)(PBR.N) and Norway’s Statoil (STL.OL)(STO.N), was needed.
 “(Reform) would depend on Congress and the political environment but I would like to do it before the end of my administration,” he said.
 But later on Tuesday during his trip to New York, Calderon said Mexico had no plans to sell shares in Pemex as a Bloomberg report suggested and that prompted some money market investors to buy the Mexican peso earlier in the day.
 Calderon said his government was focusing on selling the so-called citizen’s bonds envisioned under changes made to energy legislation in 2008.
 “What we are doing right now is preparing an issue of bonds, we call them citizen bonds, that do not imply shares, don’t imply capital of the enterprise,” he told reporters, saying shares were something to be explored in the future.
 Selling shares in Pemex, a deeply contentious proposal in Mexico where many still see state control of the oil industry as the bulwark of Mexican sovereignty, would likely face vociferous opposition and require a constitutional reform.
 A Bloomberg report suggested Pemex could be listed on the stock market and sell shares, but did not provide a quote from Calderon to back up this assertion.
 Members of Calderon’s conservative National Action Party, or PAN, said they supported more reforms but a senior lawmaker added there had been no discussion of a Pemex share sale.
 “I was aware that the president was cooking up something important on Pemex,” said Luis Enrique Mercado, the lower house deputy who leads the government in negotiations on economic measures in an interview.
 “Ever since the ‘light’ (2008) oil reform was approved, people in government circles have said something more daring was needed to change the situation in Pemex.”
 Details of how Pemex could be made more efficient like Petrobras are unclear.
 Mexico’s Congress passed a watered-down reform of Calderon’s first Pemex reform proposal in late 2008 that liberalized how the company buys goods and services.
 Pemex plans to use the new contracting rules to hire international oil companies to operate some fields on its behalf in return for a fee.
 However, Calderon faces more hurdles in Congress than in 2008 as his party lost control of the lower house in 2010. The populist Institutional Revolutionary Party, or PRI, controls the lower house, effectively giving it a block on any presidential initiatives.
 The PRI has long-standing ties to Mexico’s oil union and views the 1938 PRI-led nationalization of the oil industry as a key moment in Mexican history.
 Petrobras is listed on the stock market but is controlled by the Brazilian government, which retains significant influence over the company’s management. Brazilian legislation also allows private companies to operate oil fields and book reserves, both of which are barred by Mexico’s constitution.
 Other proposals by Calderon in 2008, including liberalizing oil refining and transport, were opposed by the PRI.
 Any move to make Pemex more like a private company would likely threaten tens of thousands of jobs at a time when Mexico’s electoral calendar is quickly moving towards the presidential elections in 2012.   (Additional Reporting by Miguel Angel Gutierrez and Jason Lange in Mexico City and Walter Brandimarte in New York; Editing by Bernard Orr)   

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below