Mexico's finance ministry to have bigger role in Pemex decisions, outgoing minister says

Mexico's finance ministry will have a bigger say in the investment decisions of the state oil and gas company Pemex going forward, as the federal government continues with its restructuring, according to the outgoing minister.

The restructuring of the company was started in this administration and has been going on for six years, said finance minister Rogelio Ramirez de la O in an event with bankers on May 7. Support from the government or the lack of it have been at the center of the considerations from rating agencies like S&P Global Ratings in their analysis of Pemex.

"During these first six years, the government has learnt what needs to be done next, which is the need to focus more on the refinancing of the company's debt involving the sovereign more directly," De la O said.

Pemex has a total indebtedness of $106 billion as of December 31, 2023, 42.9% of which, or $45.5 billion, is scheduled to mature in the next three years, the company told the US Securities and Exchange Commission in an official filing.

The restructuring of Pemex has now come to a new level with the explicit support of the government, De la O said. In 2024, the Mexican government decided to dedicate a specific budget of roughly $10 billion for the repayment of Pemex maturities for the first time in history, he noted.

Going forward, the federal balance will be "more dedicated to attend the needs of Pemex", he said, adding that together, Pemex and the government will work to reduce Pemex costs and become "more selective" in its investments, he said.

This agenda will take a more concrete shape in the next stage of the restructuring, De la O said, noting that the process is likely to take years.

Rodriguez de la O was recently invited publicly by Claudia Sheinbaum, the leading presidential candidate ahead of Mexico's upcoming general election, to remain in his position as head of the finance ministry, known as Hacienda. When asked about it during the May 7 meeting with bankers, De la O refused to comment.

Since taking office in late 2018, President Andres Manuel Lopez Obrador has injected roughly $56 billion into Pemex, its chief executive officer Octavio Romero Oropeza said recently.