Presentation of the National Strategy for the Hydrocarbons and Natural Gas Sector 2024-2030

Greenberg Traurig - On November 13, 2024, the Secretary of Energy, Luz Elena Gonzalez, presented the National Strategy for the Hydrocarbons and Natural Gas Sector 2024-2030 ("Strategy"), which establishes a framework aimed at guaranteeing energy sovereignty and security.

The following are the key points of the Strategy:
 
1. Hydrocarbon exploration and production: 
- Maintain a daily production of 1.8 million barrels.
- Prioritize domestic consumption over exports.
- Implement mixed public-private projects to explore and produce hydrocarbons.
-Guarantee reserves equivalent to ten years of consumption.

Natural gas: 
-Increase production from 3,854 to 4,976 million cubic feet per day.
-Reduce fugitive methane emissions and eliminate gas flaring and venting.
-Develop strategic storage to improve energy security.

Industrial transformation: 
-Increase gasoline, diesel and turbosine production by 343 thousand barrels per day.
-Maximize the operation of existing and new refineries, such as Olmeca and Tula.
-Reactivate petrochemical complexes such as Cangrejera and Morelos.

Renewed fiscal regime: 
-Simplification of the tax scheme for Pemex with the new Petroleum Right for Welfare, with differentiated rates for oil, associated gas and non-associated gas.

Government support and financing
-Management of Pemex’s debt, currently at 97 billion dollars, without resorting to the capital markets.
-Ensuring the company’s financial sustainability.

Competitiveness and energy transition: 
-Integrate hydrocarbons as a key element in the energy transition, guaranteeing security of supply and economic sustainability.
The strategy establishes ambitious objectives and presents a series of challenges for its implementation, among which are: (i) financial risks due to ambitious goals without clearly defined critical paths; and (ii) aspects that may require more details in mixed public-private projects, among others.

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