MEXICO: PEMEX in Death Throes Amid Political Squabbling

[phantom power]

MEXICO CITY, Feb 26 (IPS) - Mexico’s state oil company, PEMEX, is broke, and the country’s crude oil reserves will run out in less than 10 years. But although local politicians agree on the diagnosis, few are proposing solutions, while recriminations, by contrast, are flying thick and fast.

http://www.ipsnews.net/news.asp?idnews=41355

[Warpy]

1. Good, with that cash cow run dry

maybe those dozen or so colonial families holding most of that country's wealth will lose power at last and Mexico will take the leftward steps that much of Latin America has taken.

Anything that slows the flow of cash to owners and rulers is a good thing because it also diminishes their power.

Now if only we can only break our own colonial owners and rulers, the WASP uberclass that pushes us back into a boom and bust cycle every time we reform the system to get the thieves out, we might be able to join them in future prosperity.

[demosincebirth]

2. How in the hell can a oil company (with the price of crude at 100bucks) go broke?

[phantom power]

3. Their profits financed 42% of Mexico's budget.

[Extend a Hand]

4. They are in decline

Canterell declined 14% last year. A much larger decline than was expected. They are trying to improve recovery from smaller fields to make up the difference but it's not been enough. The government is extremely corrupt.

[Extend a Hand]

5. Mexico the 4th largest crude oil supplier to the United States

Crude Oil Imports (Top 15 Countries)
(Thousand Barrels per Day)
Country Dec-07 Nov-07 YTD 2007 Dec-06 Jan - Dec 2006
CANADA 1,780 1,919 1,864 1,830 1,802
SAUDI ARABIA 1,675 1,530 1,453 1,471 1,423
VENEZUELA 1,246 1,227 1,150 1,045 1,142
MEXICO 1,234 1,484 1,410 1,245 1,577
NIGERIA 1,210 1,245 1,082 1,010 1,037
ANGOLA 439 408 496 610 513
IRAQ 378 508 485 419 553
ALGERIA 348 184 443 406 362
ECUADOR 195 154 198 240 272
BRAZIL 171 78 167 130 133
KUWAIT 158 154 176 163 179
AZERBAIJAN 134 77 57 68 27
LIBYA 116 66 84 46 66
COLOMBIA 113 197 137 74 141
UNITED KINGDOM 93 42 102 93 130

http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_level_imports/current/import.html

I don't think there is a broad understanding about how serious this is.

[phantom power]

6. I was under the impression they were 3rd largest.

Here in E/E at least, we're pretty aware of it. We've been following the collapse of Cantarell, the North Sea, etc. Things are looking grim everywhere.

[Extend a Hand]

8. They were 3rd largest in 2006

but according to EIA, Venezuela supplied more in 2007

[hatrack]

10. It was worse than that - 18% YOY for 2007

nt

[jody]

7. Will the collapse of PEMEX increase the flow of illegal aliens into the U.S.? n/t

[phantom power]

9. I would expect any increase in economic and/or political unrest...

to increase the number of Mexicans trying to get into the US(*). I imagine that an actual collapse of PEMEX could cause both.




(*) At least as long as our economy and government are more stable than theirs. Not guaranteed to be true as peak oil starts to hit us harder as well.