Published On: Tue, Oct 21st, 2014

Mexico considers importing oil for the first time in history

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Sources of the commercial arm of Pemex revealed that the company is studying the possibility to buy up to 100,000 oil barrels per day, given the low prices in the market, to cover the country’s domestic requirements and maintain the current export levels.

The persistent decline in oil production could accelerate Mexico’s government decision to import crude for the first time.

Sources of PMI Comercio Internacional, the commercial arm of Petróleos Mexicanos (Pemex), revealed that the company is studying the possibility to buy up to 100,000 oil barrels per day, given the low prices in the market, to cover the country’s domestic requirements and maintain the current export levels.

“We could import oil temporarily while the energy reform starts to produce steady increases in oil and gas production,” said the executives, who requested to remain anonymous.

According to the exploration and production division of Pemex (PEP), the main oil wells have stopped producing over 140,000 barrels per day, affecting the performance of the National Refining System composed of six refineries: Tula, Salamanca, Salina Cruz, Cadereyta, Madero and Minatitlán, that jointly process 1.54 million barrels a day.

“Without enough oil, these refineries are being underutilized,” the sources explained.

Mexico’s refining system is receiving 461,000 barrels of crude oil below its total processing capacity, which has led to a 13.1% drop in the production of Magna gasoline, 11% in fueloil, 14.5% in diesel and 6.3% in jet fuel.

The sources explained that it would be counterproductive to reduce exports and use that oil for refining.

“It is not easy because Mexico’s contracts with foreign clients can be indefinite (evergreen) or long-term.”

 

Source: http://www.eluniversal.com.mx

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