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('''PEMEX''') is
Mexico 's state-owned, nationalized
Petroleum company.
Asphalt and pitch had been worked in Mexico since the time of the
Aztecs .
Small quantities of oil were first refined into
Kerosene around
1876 near
Tampico . By
1917 commercial quantities of oil were being extracted and
Refined by subsidiaries of the British
Pearson and American
Doheny companies, and had attracted the attention of the Mexican government who then claimed all mineral rights for the state as part of its
Constitution .
See Also: Expropiación Petrolera
In 1938,
President Lázaro Cárdenas sided with oil workers striking against foreign-owned oil companies for an increase in pay and social services.
On
March 18 , citing the 27th article of the 1917 constitution, President Lázaro Cárdenas embarked on the state-expropriation of all resources and facilities, nationalizing the
U.S. and
Anglo -
Dutch operating companies, creating PEMEX. In retaliation, many foreign governments closed their markets to Mexican oil. In spite of the boycott, PEMEX developed into one of the largest oil companies in the world and helped Mexico become the fifth largest oil exporter in the world.
PEMEX is the sole supplier of all commercial gasoline (petrol/diesel) stations in
Mexico . All petrol stations, although labeled PEMEX, are concessions that are strictly full-service. PEMEX tried to take away the concessions from a large number of these for low-quality gasoline (often cut with up to 40%
Fuel Oil ) and for not serving the correct amount of gasoline (many serve only 9 litres for every 10 registered on the pump), however a judge ruled these were "not reasons to take away the concessions".
The grades of PEMEX gasoline are 'Magna' (Regular Unleaded 87 octane - green pump handle) and 'Premium' (92 octane - red pump handle). Previously, PEMEX offered a leaded gasoline called 'Nova,' but this has been discontinued for environmental reasons (Nova gasoline, like many other leaded gasolines, have been discontinued due to stringent health regulations).
Although PEMEX accepts Mexican Pesos and U.S. Dollars (and fills vehicles in liters), the gas is charged in pesos. In November 2005 it was decided that a tax invoice for gasoline would only be issued when payment was made by credit card. However, not all stations are able to process credit card payments.
Customers have complained about the alleged fraud committed by some gas stations, which consisted in selling "liters" of less than 900ml (leading to some to refer to these "liters" as "chiquilitros"; i.e. "small liters"). Pemex is not responsible for such frauds and has been recently taking measures to counter this problem.
Other customers of the gas stations have been victims of "baptized" gasoline; meaning that approximately 3/4 liters of gasoline are mixed with 1/4 liters of water, in order to create a full liter capable of passing the weight inspections. Although the number of customers who have suffered this problem is relatively small, a few cars and SUVs have been ruined for this, while some more just suffered temporary malfunctions.
Most of these stations are located in areas with a very small population and low traffic.
On
June 3 ,
1979 , PEMEX's
Ixtoc I exploratory oil well in the Gulf of Mexico, about 600 miles south of Texas, suffered a blowout and became the largest unintentional
Oil Spill in history.
On
November 19 ,
1984 a series of explosions at the PEMEX petroleum storage facility at San Juan Ixhuatepec in
Mexico City ignited a major fire and killed about 500 people.
On
22 April 1992 ,
Explosions in
Guadalajara ,
Jalisco killed more than 200 people.
On
10 July 2007 , the leftist rebel group the
Popular Revolutionary Army claimed responsibility for blasts on Pemex pipelines on 5 and 10 July.
1
PEMEX, despite its current $77 billion in revenue, pays high taxes that contribute with a large portion of the budget of the federal government. Indeed, in recent years the company has only been able to make ends meet through massive borrowing, so that it now owes a staggering $42.5 billion, including $24 billion in off-balance-sheet debt because the Mexican government treats the company as a major source of revenue. The state-run company pays out over 60% of its revenue in royalties and taxes, and those funds pay for a third of the federal government's budget. If oil prices drop or there are no major new discoveries of crude, that could spell big trouble for PEMEX despite its immense revenue stream and expansion prospects. However, in 2005, with record-breaking oil prices (due to the
Iraq War , economic expansion of the United States and the
People's Republic Of China ) the company has seen an unexpected excess of funds. This tendency continued in 2006, but these funds have been used to pay salaries of bureaucrats and current costs, instead of being invested in projects of exploration and production; during
President Fox administration, these funds represent around 70 billion dollarshttp://www2.eluniversal.com.mx/pls/impreso/noticia.html?id_nota=53687&tabla=finanzas, yet the administration says there is not enough money to pay the debts.
To help capitalize the company .http://www.businessweek.com/magazine/content/04_50/b3912084_mz058.htmhttp://query.nytimes.com/gst/fullpage.html?res=9C06E4DA1731F931A35750C0A9609C8B63
In an interview on the oil news website www.oilcast.com in
November 2005 , a PEMEX employee spoke anonymously of the company's inability to grow production, stating that the company and country is at Hubbert's Peak. The person interviewed believed export levels could not be recovered once peak had passed, as the size of current fields that have been discovered or are coming online represent a fraction of the size of the oilfields going into terminal decline.
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In 1st quarter 2006, PEMEX produced more oil per day than late 2005. http://www.eia.doe.gov/emeu/ipsr/t22.xls
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Furthermore, it has been reported the 2005-2006 daily oil production was down by approximately 500,000 barrels a day (a large proportion of the country's 4.5 million barrels) on the previous year. The importance of both of these statements cannot be underestimated and speak volumes for the ability of the world to continue to meet expected demand with increased supply.
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PEMEX averaged 3.71 MMBPD in 2006. http://www.eia.doe.gov/emeu/ipsr/t22.xls
PEMEX has never produced 4 MMBPD or higher for a yearly average. http://www.eia.doe.gov/pub/international/iealf/tableg2.xls
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