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Multinational Energy Companies Making Plans to Open Service Stations in Mexico

ISSN:1054-8890
LADB Article ID: 80307
Category/Department: Mexico
Date: 2017-05-24
By: Carlos Navarro

Concerns about widespread fuel theft in Mexico have not deterred foreign energy companies from moving forward with plans to open service stations to compete with the state-run oil company PEMEX. The energy companies, however, are proceeding cautiously, in light of the government’s failure to curb the pilfering of fuel from PEMEX pipelines, which has created conflict and instability in some areas. In recent weeks, three large multinational energy companies—ExxonMobil Corp., BP, and Shell—confirmed plans to open service stations around the country. Those companies and others, including Gulf and the Mexican convenience store chain OXXO, had announced their plans to open private service stations over the next several years. The move to allow private stations to operate in Mexico is the result of energy reforms approved in 2013 and enacted in 2014. The new service stations would create competition for the approximately 11,400 service stations in Mexico. According to the Secretaría de Energía (SENER), Mexico is the world’s fourth largest gasoline market. Many of the foreign energy companies entering the Mexican market would be importing a large share of their fuel rather than relying on pipelines. However, there is concern that the criminal organizations that are behind the pilfering of fuel might find a way to tap into the supplies brought in by the foreign companies, perhaps by targeting fuel tankers en route to distribution centers or service stations.

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