Mexico’s oil regulator and state company Pemex are at odds over how to develop a deepwater natural gas project, eight people close to the matter said, threatening to stall a $1.5 billion energuy deal.
Officials at regulator National Hydrocarbons Commission (CNH) have raised questions about whether Petroleos Mexicanos can shoulder the massive project, the people said.
The Lakach field holds up to 937 billion cubic feet of reserves but rising costs have hindered development. Now, a Pemex proposal to revive development with U.S. liquefied gas company New Fortress Energy is at issue. The project’s fate could depend on the replacement for CNH chief Rogelio Hernandez, who resigned last week, the people said.
Mexican laws stipulate regulatory approval requires projects be both technically and economically viable. The standoff between CNH and Pemex over Lakach lays bare the challenges of Mexico’s effort to self-develop its reserves.
President Andres Manuel Lopez Obrador has sought to champion state companies and keep private investors on the sidelines, an agenda complicated by Pemex’s lack of capital and huge debts.
Pemex has proposed to develop Lakach with New Fortress Energy using a service contract, a formula used prior to the nation’s energy sector opening in 2013-14. Under a service contract, Pemex would retain full ownership but bear the risk if prices fall.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
T-Mobile’s Acquisition of Ka’ena Corporation Receives FCC Approval
Apr 26, 2024 by
CPI
UK Regulator Announces Two New Senior Executive Appointments
Apr 26, 2024 by
CPI
Paramount Global and Skydance Media Near Merger Deal, Eyeing CEO Change
Apr 26, 2024 by
CPI
BHP Unveils £31bn Mining Megamerger Proposal with Anglo American
Apr 25, 2024 by
nhoch@pymnts.com
ByteDance Prefers Shutdown Over Sale of TikTok Amid US Ban Threats
Apr 25, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI