New Product Launch: Assessment of Mexico’s downstream reform opportunity under AMLO

Turner, Mason & Company is pleased to announce the upcoming launch of a new offering dedicated to the assessment of Mexico’s evolving downstream reform under new President Andres Manuel Lopez Obrador (AMLO) who was sworn in on December 1, 2018.

Here are some of the perspectives we aim to cover in this offering:

  • Monitoring of the evolving AMLO policies: Since being elected, AMLO has spoken in favor of building more refining capacity within Mexico, but with an estimated cost of $6-10 billion for a new grassroots refinery, will this move towards energy self-sufficiency be justified against continued refined product imports from the US Gulf Coast? How will Mexico fund refinery investments without help from outside investors?
  • Quantifying opportunities presented by the reform: Improvements in reliability and overall utilization of the Pemex refining system would seem a more promising and higher priority undertaking. Any progress in this area will have an impact on regional and the overall country supply/demand balances for major transportation fuels and impact need or opportunity for product imports and the infrastructure necessary to support current and potentially growing volumes. Mexico’s existing logistics infrastructure, mostly built by Pemex over seven decades ago, was designed for demand being met primarily from internal sources. Opportunities for investment in midstream infrastructure to meet the growing demand for product imports is enhanced by the likelihood that new refining investment by Pemex will not occur anytime soon.
  • Monitoring the activities of 3rd parties: Opportunities for outside companies to invest in retail and introduce new fuel compositions to meet Mexican fuel efficiency and environmental goals certainly exist and several companies are already actively pursuing or considering there opportunities. The opportunities afforded for investment and development by outside parties must be carefully evaluated against the uncertainties associated with the policies of the new administration, the estimated impacts on fuel prices necessary to provide a return to prospective sponsors and investors and how these price effects will impact the purchasing behaviors of Mexican citizens and a host of other determinants.

We have recently expanded our team and have engaged two highly regarded industry experts in policy and market analysis, who each bring more than 30 years of experience following the Mexican energy markets.

  • George Baker is an advisor to Energia – an energy and policy development think tank covering matters of commerce, institutional development, policy and regulation in Mexico. George is also the editor of Mexico Energy Intelligence, a newsletter publication that has addressed the challenges and opportunities with implementation of the Mexico Energy Reform. He has been covering the Mexican markets for over 30 years as a market research analyst in the midstream and downstream sectors.
  • Guillermo Suarez is a market analyst covering the energy markets in Mexico for over 30 years and has advised governments and multinational corporations seeking to enter the Mexican market. He is a regular contributor to the Mexico Energy Intelligence and has published several articles and white papers covering midstream and downstream issues in Mexico.

The research service development will be led by Sam Davis who recently joined Turner, Mason & Company from Wood Mackenzie where he led the downstream research team as Head of Americas Oil and Refining Markets. At WoodMac, Sam expanded the downstream practice by setting up a Mexico City office in 2015 in response to the Energy Reform. He has 20 years’ experience in the refining and petrochemical industries, including 10 years of industry operating experience with Sunoco.

This expanded capability complements our existing outlook team led by John Auers.

To help us provide cutting edge research that our clients would find insightful and facilitate decision making, we are requesting your feedback in a brief two- minute survey on areas of highest interest and relevance to you and your organization regarding policy and market opportunities in Mexico under AMLO.

Please click on the link below to complete the survey. The survey will close on Tuesday January 15, 2019

Launching Mexico Market Research Service

Thank you in advance for your participation and feedback.