Reform Crucial to an Exxon Mexico Investment Ed Crooks and Adam Thomson - Financial Times
go to original June 27, 2012

ExxonMobil Chairman and CEO Rex Tillerson is seen in this 2011 file photo. (AP/Manuel Balce Ceneta)

ExxonMobil, the world’s largest oil group by market capitalisation, is interested in investing in Mexico if reforms of the industry make contract terms more attractive, the company’s chief executive has said.

Rex Tillerson, Exxon’s chief executive, said at a meeting of the Council on Foreign Relations in New York: “We’re hopeful that Mexico, as it continues its pathway to reforms . . . will open up opportunities for greater partnerships and collaborations, and bringing technology to bear on the huge resources that Mexico has.”

His comments came as Mexico’s leading candidate in Sunday’s presidential election spoke out in favour of long-awaited energy reform, holding out the prospect that the country could follow Brazil’s example in developing a successful oil industry.

Mr Tillerson warned that change was “a ways off yet”, but said Exxon had been working with Pemex, Mexico’s national oil company, on joint studies “primarily so we can get to know one another, and see what each other’s capabilities are”.

He added: “It’s going to be a long process, and what we’re advocating for is just for Mexico to take the next step . . . And if the next step provides an avenue for ExxonMobil to participate, we will.”

Mexico is among the world’s top 10 oil producers, but its restrictive constitution limits the role that private companies can play. As a result, Pemex cannot enter joint venture contracts with third parties that would enable them to share the risks and rewards of exploring for oil.

Mr Tillerson made it clear that Exxon would be prepared to invest in Mexico only if it was allowed to share in the upside and downside of oil and gas prices.

Read more at The Financial Times

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