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Mexico President Proposes Sweeping Energy Reform

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Mexican President Enrique Peña Nieto wants to open the state oil company to private and foreign investment.

But workers at Pemex, the world’s eighth-largest oil company, believe the changes will make things worse for them.

Many already complain of low wages and late or non payment by the state-run monopoly.

Foreign companies have been banned from Mexico’s oil industry since nationalization in 1938.

“About 80 percent of Mexicans now associate Pemex with corruption, according to a recent poll, and do not believe that Peña Nieto’s plans will do much beyond creating more rich elites,” according to a story by the Washington Post.

Oil revenue constitutes 30 percent of Mexico’s federal budget.

Mexico’s oil production peaked in 2004 at about 3.5 million barrels a day.

Production has fallen to an estimated 2.5 million barrels a day, due mainly to depletion of shallow reservoirs.

President Peña Nieto last week proposed allowing Pemex to have partners who would share in the risks and rewards. Those arrangements are now banned by Mexico’s constitution.

The president said Mexico’s future depends on access to energy through expansion of oil and gas production.

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