Pemex 'needs to wait' on IPO, says CFO
Pemex CFO and treasurer say the firm has enough to concentrate on as Mexico’s energy sector opens to the private sector, before the state oil firm can think about going public
An IPO of Mexico’s national oil company offers
benefits but is unlikely for perhaps a decade,
Pemex’s chief financial officer Mario Beauregard
has told LatinFinance, as the firm evaluates the
sweeping range of new opportunities and capital raising options
open to it as Mexico’s energy reforms take effect.
||Hot sector: a Pemex oil refinery in
Texas. Photo: Roy Luck
Under Round Zero of Mexico’s energy reforms,
Pemex has asked to maintain rights to over 90% of fields in
production, as well as most of the less developed fields.
Partly as a result, its funding needs are growing. Capital
expenditure is set to increase to $29bn in 2015, from $27bn
At the same time, three of the firm’s six oil
refineries need rehabilitating. "If we are successful in
revamping those refineries, we will be able to increase
profits, but in the initial stage, you need to fund those
investments to get those profits," said Beauregard.
"We need to invest a lot of money, and here you are talking
billions of dollars," he said.
With the reform, said treasurer Rodolfo Campos, the private
sector will provide more investment, particularly in deep-water
fields, which will "reduce the pressure" on Pemex, including
its tax obligations. But that will take
time—legislators are still debating the final
"In the future there will be a lot of pressure to invest
more and more," said Campos.
Beauregard said a listing of Pemex or specific projects
could help the firm fund that investment. But he said it would
be unlikely in the short term, and perhaps for as much as 10
"This is a sensitive issue here in Mexico, especially when
we are approving the energy reform, ending 76 years of a
monopoly. We need to wait," he told LatinFinance in a
recent interview in Mexico City.
Campos said the firm has sufficient opportunities and "so
many things to solve" before it embarks on an IPO, including
putting Pemex’s balance sheet on a more
sustainable footing. "You have to clean up the house first,
take advantage of all the opportunities", before thinking of
the possibility of an IPO – "maybe in a couple of
decades or more", said Campos.
Sales of petrochemicals, distribution, storage or pipeline
assets —no longer strategic to the firm — are
more likely measures to bolster capital, said Beauregard. Such
divestments were not allowed under previous legislation.
Working with private companies, through licensing or profit
or production sharing schemes, would also alleviate funding
pressures, he said.