The United States and Mexico are working through disputes involving American companies in the Mexican energy sector worth more than an estimated $30 billion in investment, the U.S. ambassador said on Wednesday, June 15th.
Ambassador Ken Salazar said his government was making progress in resolving problems affecting U.S. businesses in Mexico, which range from operators of fuel terminals to generators of renewable energy.
“These 17 companies were companies that had very significant disputes with the Mexican government,” Salazar said.
Mexican President Andres Manuel Lopez Obrador has moved aggressively to redraw energy sector rules for the benefit of state oil company Petroleos Mexicanos (Pemex) and public power utility Comision Federal de Electricidad (CFE), arguing past governments skewed the market in favor of private capital.
However, that energy policy has put Mexico at odds with the United States and other top trading partners, causing ructions with a string of major corporate investors in the country.
Some of the projects in dispute are already moving forward, and the “proof will be in the pudding” as to how many of them can be resolved under the current government, Salazar said.
A former U.S. secretary of the interior, Salazar did not name any of the companies.
Among those talking to Mexico is oil firm Talos, which Lopez Obrador said this month is close to reaching a deal over a crude discovery shared with Pemex.
The ambassador said some of the estimated $30 billion were investments that had already been made, such as for completed fuel terminals and renewable energy facilities, while another chunk was for pending projects.
The investments in question were important for North American energy integration, Salazar said and noted it was important to ensure a legal environment under which U.S. businesses felt that “they can invest safely” in Mexico.
Describing the investments as both an opportunity and a challenge, Salazar said Mexico’s government understood the need to integrate North America’s economies to encourage the near-shoring of manufacturing capacity “from China and elsewhere.”
Source: El Financiero