The candidate for the presidency of Mexico from the Morena party, Claudia Sheinbaumsaid predicts that the debt of Petróleos Mexicanos (Pemex)the most indebted oil company in the world, be refinanced before the next bond maturities in 2025.
“Well, it necessarily has to be 2025, because there is a part of the debt maturity that is coming next year, and we have to work on it,” he said in an interview during Mexico’s annual Banking Convention. The plan “will most likely be left to us by the current director of Pemex and the president in a long-term scheme.”
Analysts and investors agree that the fate of Pemex It will be one of the greatest challenges that the next president of Mexico will inherit. The company’s debt is around $106 billion, of which $6.8 billion matures in 2025.
Sheinbaum, former head of the Mexico City government of the ruling Morena party, has positioned herself as the natural successor to President Andrés Manuel López Obrador. The popularity of AMLO, as the president is known, has helped Sheinbaum maintain 58 percent effective intent of voting, according to the Bloomberg Barometer, before the June 2 elections.
He added that his team will have to build on the plan left by the current Administration and management, establishing a calendar for Pemex develop other business plans.
“We have to work in two schemes. On the one hand, the refinancing of the debt and allowing this refinancing to be associated with both oil production, its refining and, at the same time, Pemex’s entry into other energy sources or other electricity generation schemes,” he added. .
The Pemex oil and gas production has fallen to less than half than it was two decades ago. To recover its production, debt reduction is key as money that could be used to repair its infrastructure is instead used to cover unpaid bills and interest. The company’s debt has also largely impeded its market access, and refinancing the bonds could prove costly as global interest rates remain high.
The company has approximately $8.8 billion in debt maturing in the remainder of 2024, according to its latest earnings presentation. López Obrador’s government has promised to cover most of it.
Who would be the new director of Pemex with Sheinbaum as president?
Sheinbaum said he would seek to appoint a CEO of Pemex who has both financial knowledge and experience in the oil sector. He said that he had someone in mind for the position, but that he would only reveal the name at “the right time.”
Sheinbaum, an environmental engineer and former mayor of Mexico City, outlined her energy strategy last month, including a cap of about 1.8 million barrels a day on Pemex’s oil production in the coming years (a slight increase from previous 1.5 million today) while the government focuses on generating energy. green energy growth.
Lately, Pemex has relied on tax breaks and cash injections from the government to stay afloat. AMLO has lavished support on the company, granting it up to 1.37 trillion pesos, or about $80 billion, over the course of his administration.
The company’s future plans, including participation in the lithium extraction, They are financially viable, Sheinbaum stated in the interview. Financing for energy initiatives would come partly from the private sector and partly from additional income from projects carried out during the López Obrador administration, such as the purchase of plants from the Spanish firm Iberdrola.
Its administration too would look for ways to improve Pemex’s environmental recordfacing problems such as methane emissions.
“We have to advance what would be a vision of decarbonization of the economy, to what extent oil will continue to be produced and until when,” he stated. “Natural gas will continue to be a very important fuel in the future.”
