Mexico Considering Reforms to Allow Foreign Oil Investment
Mexico’s senate began discussions Tuesday on enabling legislation to implement historic constitutional reform opening the country’s oil industry to foreign investment for the first time since 1938.
President Enrique Pena Nieto had already signed the controversial measure after it was approved by Congress and ratified by a majority of states, but lawmakers must now pass “secondary” laws to implement it.
That process began Tuesday with the energy and legislative affairs committees holding an extraordinary session on the basis of a draft drawn up by two of the country’s leading parties, the Institutional Revolutionary Party (PRI) and the conservative National Action Party (PAN).
Foreign oil giants are keen to get a glimpse of the legislation because it will detail how the contract system will work.
But a third party, the left-wing Democratic Revolution Party (PRD), vehemently opposes the reforms and issued a statement Tuesday reiterating its stance.
It is hoping to hold a referendum in 2015 to overturn the measures and has accused the ruling PRI of “political opportunism” by seizing on the public’s passion for football and scheduling debates during the month-long World Cup that kicks off Thursday.
The clash of calendars sparked a political storm, with opponents of the legislation crying foul.
The government contends the reform will allow for modernization and more economic autonomy for state oil company Pemex.
Mexico’s oil production has seen a significant drop over the past decade.