Mexico Largest Opposition Party Seeks to Sell Pemex Shares
Mexico Largest Opposition Party Seeks to Sell Pemex Shares
The National Action Party’s proposal for PEMEX to sell shares “ensures that a number of options are considered” to reform Mexico’s energy industry, suggests AS/COA’s Eric Farnsworth.
Mexico’s opposition National Action Party today sent Congress a bill to change the constitution and pave the way for Petroleos Mexicanos to sell shares.
The changes would require additional legislation to enable a “small” share sale, said Salvador Vega, the party’s top member on the Senate Energy Committee. The proposal would also break the monopoly on electricity generation and distribution held by state power company Comision Federal de Electricidad, or CFE, he said.
The PAN is proposing the most “audacious” changes in Mexico’s energy industry since 1938, when Mexico expropriated assets from U.K. and U.S. companies and changed its constitution to assert control over its energy resources, Vega said. The proposal may go beyond that of President Enrique Pena Nieto who last month declined to say whether he’ll push to change the constitution and has promised to “modernize, not privatize” Pemex.
“We’re looking for a way to democratize Pemex, including listing small amounts of shares,” Vega said today in a telephone interview from Mexico City. “We’re also contemplating an opening for the electric sector.”
The PAN’s announcement preempts the energy proposal expected from Pena Nieto’s Institutional Revolutionary Party, or PRI. That plan will be presented within days, David Penchyna, the head of the Senate Energy Committee and a member of the PRI, said in an interview today with Radio Formula....
Reform Agendas
“My sense is that the PAN does want to go further on energy reform, and by putting these types of topics into the debate are ensuring that a number of options are considered,” Eric Farnsworth, head of the Washington office of the Council of the Americas, said in a telephone interview. “Whether or not it’s a bridge too far is something the Mexican people would obviously have to decide.”
When asked about the possibility of a share sale at a news conference today, PAN lawmaker Ruben Camarillo said the proposal would call for annual Congressional approval of Pemex’s debt levels and whether parts of its funding would come from a share offering....
