Shipping & Transport - Mexico
FollowEffects of energy reform on maritime industry
Contributed by M & L Estudio Legal
September 09 2015
After a decades-long monopoly over the production and commercialisation of oil and electricity by state entities PEMEX and the Federal Electricity Commission, the private sector can now participate in these activities as a result of the comprehensive energy reform implemented in 2014.
One of the main concerns in respect of oil and gas reserves in the Gulf of Mexico relates to the maritime equipment used to extract and develop these resources, especially those situated in deep waters. Mexico does not have the specialised vessels and platforms available in other countries – such as Brazil, which in 2008 began to overhaul its state oil company, Petrobras. In order to increase Petrobras's maritime capabilities, a $240 million special guaranty fund was established as collateral for loans provided for the acquisition of marine equipment in Brazilian yards. A memorandum of understanding was also signed between Petrobras and Noble Corporation for the acquisition of semi-submersible platforms amounting to $4 billion.
Neither the Mexican government nor Pemex has announced effective measures to support investment in the marine equipment that will be needed to implement the energy reform effectively. It appears that the government expects this issue to be addressed through associations between national and foreign shipowners.
The Mexican Shipowners Association has noted that in order to meet the maritime requirements under the energy reform, an initial investment of at least $3 billion during the first three years will be needed to acquire high-specification vessels, tankers and offshore supply ships.
According to the Maritime Law, cabotage services are restricted to Mexican-flagged vessels. In the absence of Mexican vessels (or where they are very limited), foreign-flagged vessels may participate in such activities under certain strict conditions and for limited periods (for further details please see "New maritime regulations published").
Many observers are of the view that the energy reform will be the ultimate driver for the promotion, growth and consolidation of the Mexican merchant marine. However, this will likely be facilitated mainly through associations or joint ventures between Mexican shipping companies and foreign partners interested in participating in the Mexican oil industry (on the basis set out in the energy reform), following the necessary evaluation of the conditions affecting global oil prices.
For further information on this topic please contact Juan Carlos Merodio at M & L Estudio Legal by telephone (+52 55 5207 1187) or email (j.merodio@ml-estudiolegal.com.mx). The M & L Estudio Legal website can be accessed at www.ml-estudiolegal.com.mx.
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