Mexico Ends Oil and Gas Monopoly
In December, President Enrique Pena Nieto signed into law a measure that allows private companies to drill for oil and gas in Mexico. The new law ends a seven-decade monopoly held by Petroleos Mexicanos, or PEMEX, the state-owned oil company.
The monopoly was seen by many in Mexico as a protection of Mexico’s heritage from foreign interests, according to reports. Pena Nieto said the energy bill was a fundamental and historic reform that was needed to speed up Mexico’s lagging economic growth.
The new law will allow private companies to enter into contracts for profit-sharing and production-sharing that will help Mexico explore and drill for oil and gas that the country has been unable to extract, including deep-water deposits and shale oil and gas reserves. Mexico’s oil and gas production has fallen 25 percent since 2004, despite increases in production in Canada and the United States during that span.
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