Mexico leftists camp in Congress to stop oil plan

By Jason Lange and Miguel Angel Gutierrez

MEXICO CITY, April 11 (Reuters) - Leftist lawmakers blocked both houses of Mexico's Congress on Friday after an all-night sleepover protest against an oil reform plan that could open the state-run sector to more foreign investment.

Senators and deputies from the Party of the Democratic Revolution, or PRD, rolled out their sleeping bags on the floors of the upper and lower chambers on Thursday night after storming podiums to halt a debate on the government plan.

They vowed to block congressional sessions indefinitely unless the ruling conservatives and centrists, who broadly back the plan, pledge in writing to open a broad discussion that would bring in outside experts and run until August.

"The decision we have made is to stay," said Javier Gonzalez, who heads the PRD in the lower house.

Some leftist protesters slept overnight in tents outside the Senate and the chamber of deputies. Inside the lower house, lawmakers snoozed on benches wearing oil worker hard hats, and on Friday morning they sang songs and waved Mexican flags.

President Felipe Calderon handed in a proposal on Tuesday to give state-run oil monopoly Pemex more autonomy and let it work with private companies under service contracts with bonus fees based on performance.

The PRD says Calderon is trying to privatize the cherished oil monopoly on the sly, but the party is split over whether to fight the plan in the debating chamber or with street protests.

Mexico, which nationalized its oil industry in 1938, is the world's No. 5 crude producer and a top supplier to the United States. However, Pemex says it cannot shore up declining output and reserves without foreign partners.