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Energy Sector

Image: Global Energy March 2013

Overview

Energy Market

USD Million

 

2010

2011

2012

2013 **

(estimated)

Total Market Size

9,781.5

10, 159.3

9,990.0

11,350.0

Total Local Production

3,974.6

4,082.9

4,250.0

4,640.0

Total Exports

11,849.9

12,100.2

12,500.0

13,080.0

Total Imports

17,656.8

18,176.6

18,240.0

19,790.0

Imports from the U.S.

11,904.9

12,202.3

12,332.0

13,526.0

Exchange Rate: 1 USD*

12.34

13.86

13.90

14.00

Oil and Gas Market

USD Million

 

2010

2011

2012

2013 **

(estimated)

Total Market Size

6,151.5

6,456.7

6,550.0

7,020.0

Total Local Production

1,924.6

1,991.9

1,950.0

2,100.0

Total Exports

1,329.9

1,369.8

1,520.0

1,980.0

Total Imports

5,556.8

5,834.6

6,120.3

6,900.0

Imports from the U.S.

3,954.9

4,093.3

4,454.0

4,761.0

Exchange Rate: 1 USD*

12.34

13.86

13.90

14.00

Electric Market

 

2010

2011

2012

2013 **

(estimated)

Total Market Size

3,630.0

3,702.6

3,440.0

4,330.0

Total Local Production

2,050.0

2,091.0

2,300.0

5,540.0

Total Exports

10,520.0

10,730.4

10,980.0

11,100.0

Total Imports

12,100.0

12,342.0

12,120.0

12,890.0

Imports from the U.S.

7,950.0

8,109.0

7,878.0

8,765.0

Exchange Rate: 1 USD*

12.34

13.86

13.90

14.00

*Central Bank’s Statistics and Projections (Banco de Mexico).

** Based on statistics available from January to April 2013

Sources of information: BANCOMEXT, Mexican Import/Export Bank statistics, Secretary of Economy statistics;Global Trade Atlas; information and interviews with PEMEX, CFE, and SENER officials; 2012 PEMEX and CFE Budget; interviews with oil and gas contractors, members of the College of Petroleum Engineers, and representatives of U.S. companies in Mexico.

In 2013, the demand for imported energy-related equipment and services as a whole will increase by approximately 8.4 percent while U.S. exports to Mexico will grow by an estimated 9.6 percent during the same period of time. The demand for imported oil and gas equipment and services will increase by approximately 12.7 percent while U.S. exports to Mexico will grow by an estimated 6.8 percent during the same period.

Oil and gas infrastructure will continue to be a priority for Mexico’s federal government during the period 2012-2018. The state-owned energy company, Petroleos Mexicanos (PEMEX), has been granted a 2013 budget of $28 billion for new infrastructure and the maintenance of existing refineries, oil and gas pipelines, etc. (see “Opportunities” below)

In the electric power sector, the demand for imported equipment and services for this subsector will increase by approximately 6.3 percent during 2013, while U.S. exports to Mexico will grow an estimated 11.2 percent during the same period.

Best Prospects / Services

In the oil and gas subsector, PEMEX will continue to make large investments in oil exploration and production in order to maintain falling production levels. PEMEX already relies heavily on imported products and services and is expected to continue to invest heavily in developing deepwater reserves as well as advanced extraction of maturing on shore fields. Also, natural gas capture at well heads is an opportunity for U.S. companies.

Mexico is expected to pass an energy reform bill in summer/fall 2013, which may open up additional opportunities for U.S. technology and services

Opportunities

A number of major projects will drive investment in the sector and offer U.S. companies opportunities either as contractors, sub-contractors, or suppliers of equipment/technology:

Oil Exploration and Production :

53 exploration wells in the Chicontepec area with a budget of $530 Million

6 mature fields exploration Wells in the North Region with a budget of $220 million

10 deep water exploration projects (including the Perdido Area) with a budget of $300 million

40 offshore platforms on the Gulf of Mexico with a budget of $1 billion

Shale Gas Exploration:

10 wells in the State of Coahuila, Tamaulipas, Veracruz, and Nuevo Leon with a budget of $150 million

Pipe Rehabilitation and New Pipelines:

600 km natural gas pipeline project from Veracruz to Tamaulipas and Nuevo Leon with an estimated budget of $700 million

2,000 new kilometers of gas pipelines to link U.S. natural gas suppliers and PEMEX gas pipeline system for states on the Gulf of Mexico and states on the Pacific

Refineries:

Reconfiguration of the Salina Cruz Refinery and the Salamanca Refinery, and continued work at the Tula New Refinery.

Others: Pemex will increase the demand of Christmas Trees Control Systems (offshore); Wellheads; Drilling Rigs; Valves systems; Well shooting etc. The estimated budget is US$90 million.

Power Generation

According to the 2013-2027 National Energy Strategy, there is an emphasis on diversifying the sources of power generation by increasing the use of combined cycle equipment, by modernizing outdated electricity plants with the installation of clean and efficient technologies, and by increasing the supply of power generation sources, primarily natural gas. Furthermore, the new administration has recognized the need to expand the electricity network in order to include those areas of the country that are poorly served or where the electricity supply has been difficult and costly. To accomplish the electricity network expansion, which is intended to serve 130 million inhabitants by 2027, there is a focus to promote energy efficiency and renewable technologies. There is also a recognition that the three levels of the government, federal, state and municipal, must collaborate in order to accomplish these objectives.

Resources

Secretariat of Energy: http://www.energia.gob.mx

Mexican oil parastatal - PEMEX: http://www.pemex.gob.mx

Energy Regulatory Commission: http://www.cre.gob.mx

College of Petroleum Engineers of Mexico: http://www.cipm.org.mx

National Infrastructure Plan: http://www.infraestructura.gob.mx

Mexican Association of Petroleum Service

Companies –AMESPAC http://www.amespac.org.mx

Federal Electricity Commission

(electricity parastatal) http://www.cfe.gob.mx

For more information please contact:

Francisco Ceron, Senior Commercial Specialist (Oil and Gas)

Commercial Service, U.S. Embassy in Mexico City

Francisco.ceron@trade.gov

Claudia Salgado, Commercial Specialist (Electric Power)

Commercial Service, U.S. Embassy in Mexico City

Claudia.Salgado@trade.gov