Three years of energy reforms in Mexico will help oil production rebound, increase renewable energy's role in powering the country, and reduce carbon emissions, according to the International Energy Agency's latest review of the provisions.
The Reforma Energetica currently in motion in the North American nation will also end the 75-year domination of PEMEX, or Petroleos Mexicanos, in the oil and gas sector and of the Comision Federal de Electricidad (CFE) in the electric utilities sector, a new report by World Oil said.
Mexico's proactive efforts aim to stem the natural decline from large offshore fields that resulted in reduced oil production and lost market share in the United States.
"This is not a reform, it's a revolution on an unprecedented scale," Dr. Fatih Birol, the executive director of the IEA, said. "This transformation touches every sector of the Mexican energy industry and goes well beyond."
Still, the energy expert cautioned against believing that Mexico's energy goals had already been met.
"Let's not underestimate the task ahead," Birol said. "It is a huge undertaking and there will be challenges but the reform has made remarkable progress. The government's path forward is the right one and the IEA stands ready to assist."
Mexico applied to join the IEA for the first time in November 2015. If the country is accepted, it would support the global organization's commitment to its new "open door" policy in the coming years.
"The Mexico Energy Outlook motivates us to continue in the path traced by the Energy Reform and to double our efforts," Mexican Energy Secretary Pedro JoaquÃn Coldwell said. "The report includes some very convincing findings on what Mexico would have faced if the reform had never been enacted."
State-run PEMEX reported this week that its oil exports in September jumped, allowing the country to recover from a 26-year low in August.
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on… More