Pemex’s multi-billion dollar losses soar 38% in 2020

According to the company’s financial report, the areas that contributed to Pemex’s total loss were Industrial Transformation and Exploration and Production.

MEXICO CITY (PEMEX) – Petróleos Mexicanos (Pemex) recorded losses in 2020, 38.2 percent higher than those it had in 2019, according to its financial results. From January 1 to December 31, 2020, the company had a loss of 480 billion 966 million pesos, while in the same period of 2019, it was 347 billion 926 million pesos.

According to the company’s financial report, in 2020, the areas that contributed to generate Pemex’s total loss were Industrial Transformation and Exploration and Production, which contributed 45.6 and 41.9 percent of the negative result, respectively.

However, for the fourth quarter of 2020, Petróleos Mexicanos (Pemex) reported a net profit of 124.21 billion pesos, informed Octavio Romero, CEO of the company.

In a press conference, he pointed out that the profit was achieved for the second consecutive quarter and that it had been more than four years since Pemex had achieved two consecutive quarters of profits.

In the fourth quarter of 2019, Pemex reported a loss of 171 thousand 544 million pesos. Romero pointed out that according to Pemex’s preliminary figures, a 20.7 percent reduction was recorded. The oil extraction costs dropped from 14.06 dollars per barrel in 2019 to 11.15 dollars per barrel by 2020.

He highlighted that with transparency and corruption eradication practices, the company obtained savings of 40,540 million pesos in terms of prices and rates for goods and services contracted in exploration and production.

In turn, Pemex increased oil production in 2020 by registering one million 705 thousand barrels per day as an annual average, which meant an increase of four thousand barrels per day concerning the average annual production of 2019.

This last year’s production figure ends the fifteen years of constant drops in oil production. Oropeza clarified that the current administration had not changed its methodology for reporting oil production figures.

He also reminded that Pemex collaborated in the OPEC Agreement to reduce its production by 100 thousand barrels per day as of May 2020. Oropeza explained that the original agreement established the reduction commitment for May and June. Subsequently, the agreement was extended to July.

“These three months of validity of the agreement, represented for the company an induced reduction of 9 million 200 thousand barrels of oil”, said the executive.

He added that the achievement of having increased production in 2020 is due to the incorporation of 146.5 thousand barrels per day of production, coming from the new fields that began their development in the first half of 2019. “In record time for the industry, in less than two years, Pemex managed to incorporate production in its new developments,” he said.

According to Pemex’s results, for the second consecutive year, its reserves grew from 7.2 billion barrels of crude oil equivalent at the beginning of 2020 to 7.4 billion barrels at the beginning of 2021.

On the other hand, Romero detailed that during the past year, Pemex delivered to the Federal Government resources for 598,330 million pesos for direct and indirect contributions.

This figure of contributions paid is net since it already considers the fiscal benefit granted to the company in the payment of the Shared Utility Right (DUC).

Thus, in the first two years of the current administration, the state-owned productive company has delivered to the Federation 1 trillion 473 thousand 409 million pesos in contributions.