Mexico, once the world leader in oil production, now finds itself at a critical crossroads.
The new president, Claudia Sheinbaum, faces a major challenge: compensating for the drop in national production, which could jeopardize her predecessor’s dream of energy independence.
Decline in Production
Production from Mexico’s old oil fields, mainly in the Gulf of Mexico, is at an all-time low.
Without significant investment in exploration and production, the country could be forced to import oil to feed its expanded refining capacity over the next decade. This would be an unprecedented turnaround for a country that has long been a key exporter on the world market. To meet local demand for fuel, Petróleos Mexicanos (Pemex) failed to modernize its aging refineries, which were incapable of efficiently processing heavy Maya crude.
As a result, Mexico had to export crude while importing gasoline and diesel, mainly from the United States.
Investments and New Projects
The outgoing administration invested $17 billion in the new Olmeca refinery in Dos Bocas, aimed at reducing this dependence.
However, this refinery, although oversized and overdue, will not be able to compensate for the rapid drop in production expected after 2030.
The Zama and Trion fields should temporarily boost production to around 2.247 million barrels per day by 2028, according to Ministry of Energy forecasts.
However, these gains will not last, and the country may need to import oil to keep its refineries running at full capacity.
Unexplored potential
Alma America Porres, former commissioner of the National Hydrocarbons Commission (CNH), points out that proven crude reserves suggest that the shortage could come sooner than expected.
Mexico’s proven oil reserves fell to 5.978 billion barrels this year, down from 6.155 billion barrels the previous year.
Production from older fields, including the Cantarell field, once the world’s second largest, has declined rapidly in recent years.
New fields have not been able to compensate for this decline.
Challenges and opportunities
Former president Lopez Obrador’s strategy of increasing refining capacity rather than exploration has drawn criticism.
Experts believe that the massive investment in the Olmeca refinery would have been better used for the exploration and production of new oil fields, or for diversification into renewable energy sources.
The legal framework for the participation of private companies remains in place.
These companies could add value by investing in exploration, an area where Pemex lacks funds and expertise.
Mexico’s energy future will depend on its ability to attract private investment in oil exploration and production.
Claudia Sheinbaum, with her expertise in power engineering and commitment to renewable energies, will have to navigate between preserving the nationalist heritage of her predecessor and the necessary openness to international collaboration.
This hybrid approach could be the key to ensuring Mexico’s energy security while integrating more sustainable energy sources.
