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INTERVIEW-Mexico expects oil investments to double to $60 bln by 2018 -official
August 13, 2014 / 12:47 AM / 3 years ago

INTERVIEW-Mexico expects oil investments to double to $60 bln by 2018 -official

MEXICO CITY, Aug 12 (Reuters) - Mexico expects to double the amount of investment in oil and gas projects to $60 billion per year by 2018 as private companies rush into the previously state-run energy industry, a top finance ministry official said on Tuesday.

Mexican President Enrique Pena Nieto on Monday signed a package of laws needed to implement last year’s energy reform that aims to increase flagging oil output and help lift sluggish growth in Latin America’s No. 2 economy.

“We expect to see a certain amount of investment during next year, and obviously these investments will accelerate as things move forward,” deputy finance minister Miguel Messmacher told Reuters in an interview in Mexico City.

“In the whole of hydrocarbons, we expect the reform will allow us to go from investment levels around $30 billion per year, as we now have, to levels around $60 billion,” he said.

On Wednesday the energy ministry will announce which fields will be put up for foreign and private oil companies in the first round of public tenders, expected to take place next year.

Messmacher, who overseas government revenues, said the reform would eventually cut Pemex’s annual tax burden by 90 billion Mexican pesos ($6.85 billion).

The government relies on taxing state-run Pemex for about one-third of its revenue and the oil company’s heavy tax burden has curbed its ability to invest in new projects.

Pemex will see its tax burden fall as the government begins to see income from taxes and royalties on new private energy projects.

“We do not expect that the change of Pemex’s tax regime will create any fiscal pressure,” Messmacher said. (1 US dollar = 13.1458 Mexican peso) (Reporting by Luis Rojas and Adriana Barrera; Editing by Ken Wills)

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