• BLACKOUTS: The current power outages across northern Mexico, stemming from shortages of natural gas due to frigid weather in Texas, have not only exposed the country’s dependence on imports but also the shortcomings of its gas storage and production policies.
• STORAGE: Despite having almost none today, López Obrador administration shelved a 2018 plan to develop 45 billion cubic feet (Bcf) of underground gas storage capacity by 2029. Using private investment, the plan would have allowed Mexico to have enough reserves for 5 days.
• PRODUCTION: Meanwhile, natural gas production by state-owned oil company Petróleos Mexicanos (Pemex) has fallen 3.8 percent since president López Obrador arrived in power despite major government aid. In the third quarter of 2020, Pemex’s gas production was 3.68 BcF.
• RISK: “This government suspended (oil and gas production) tenders and canceled Pemex’s partnerships with private companies, which has seriously compromised future gas production”, said Clúster de Energía Coahuila, an energy lobby group in the state of Coahuila, which borders Texas.
