Mexico’s energy reforms could be undercut or reversed if a left-wing candidate succeeds in ousting the sitting national President Enrique Pena Nieto, according to Reuters.
Andres Manuel Lopez Obrador, who has twice before run for the top office in the land, is looking likelier than ever to oust Pena Nieto whose popularity has plunged because of economic woes, corruption scandals and out-of-control criminal gang violence.
Should Lopez Obrador (known as AMLO) become president he has pledged to undo the energy reforms.
He would hold a referendum on whether oil firms should be allowed to develop projects (including offshore ones) alone, as the reforms encourage. He would require state oil company Pemex to take a minimum stake in all future oil contracts in Mexican territory.
And he could revoke two dozen contracts already signed with companies other than Pemex.
The reforms have been aimed at loosening Pemex’s dominant, near monopoly, position on domestic projects and increasing efficiencies by bringing in private sector and foreign players.
The next presidential election is in 2018 and the reforms may already be too far down the line by then. This coming December is expected to see intense bidding when deepwater sites come up for auction.
Previous auctions of Mexican leases under the reform process have not been very successful.