MGM concluded a share purchase agreement with Iberdrola Energía, S.A.U., a wholly owned subsidiary of Iberdrola, S.A. on September 18, for Mitsui’s acquisition of a 13.25% share in Gas Natural Mexico, S.A. de C.V. with the purchase amount of US$ 82million (Approx. J¥ 6.5bil.). The completion of the transaction is subject to the relevant regulatory approvals.
In addition, Mitsui has also reached an agreement with the remaining shareholders in GNM to acquire 1.75% of an additional shareholding in GNM with the purchase amount of US$ 10.8milliion (Approx. J¥ 0.9bil.) to reach 15% in total. The completion of this transaction is also subject to the relevant regulatory approvals and closing of the purchase to Iberdrola.
GNM is providing natural gas distribution for residential, commercial and industrial segments in 6 zones in Mexico, including Mexico City and Monterrey, which are two of the largest cities, and Toluca and Bajio, which are two of the most developing cities in the country. GNM is providing its services to 1.3million customers and is the leading natural gas distribution company in Mexico, having a top market share both in terms of the number of clients and gas distribution volume.
Mitsui is currently engaged in various natural gas related businesses in Mexico, including the LNG receiving terminal at Manzanillo on the Pacific coast and 6 gas-fired power plants in the country, as well as a gas distribution business in 7 states of Brazil. Mitsui considers this transaction as a part of the vertical and horizontal expansion of Mitsui’s activities in gas related business and aims for further improvement of operation and service in each business utilizing its accumulated know-how in management and operation from existing businesses.
Mitsui expects further strong growth in the natural gas related market in Mexico based on the continuous demand increase caused by the steady and sustainable economic growth of the country and on the diversification of supply thanks to the shale gas development in Mexico and the US.
Mitsui, through this participation in GNM, continues to pursue further expansion of its activities in gas related infrastructure businesses in Mexico, contributing to the social and economic development of Mexico through the realization of infrastructure for a stable and sustainable energy supply.
Posted on September 3, 2012 at 12:38 am by FuelFix.com
MEXICO CITY — Mexico’s national oil monopoly has been issuing critical alerts seemingly every week, warning of natural gas shortages lasting hours or even days and crimping supplies to homes, power plants and factories.
And yet, the country has some of the world’s largest natural gas reserves and easy access to a cheap and plentiful U.S. supply.
“There hasn’t been enough energy planning in this country,” said Raul Monteforte, a former senior official with Mexico’s Energy Regulatory Commission who’s now development director for Fermaca, a private Mexican transportation pipeline company. “Huge errors of omission have brought us a gas crisis.”
The gas squeeze will only worsen as many of Mexico’s new and existing electricity plants abandon coal and other fuels in favor of natural gas, gobbling up much of the available supply.
Petroleos Mexicanos, or Pemex, as the monopoly is called, will prove unable to get much more of the gas produced in its own fields to market.
Amid renewed political pressure to further open Mexico’s energy industries to private interests, energy planners have launched a frenzied expansion of the country’s woeful pipeline system. As much as 3 billion additional cubic feet per day of U.S. natural gas, most of it from Texas, will feed the new grid.
Central Mexican cities have been the worst affected by the critical shortage, but even companies in Monterrey, the industrial powerhouse that abuts the sprawling Burgos Basin gas fields, have been slammed.
“Such obstacles can’t be permitted, even less so ones provoked by a state monopoly,” Caintra, a leading Monterrey business association, declared in a full-page newspaper ad. “We demand an immediate solution.”
Texas, Arizona lines
Using an offshore Pemex subsidiary supposedly free of Mexican congressional oversight and constitutional restrictions, planners are rushing to build two new U.S. pipelines – to the Arizona border south of Tucson and from near Corpus Christi to the Rio Grande – to push that U.S. gas deep into the Mexican heartland.
Officials say the new pipelines will be completed by the late summer 2014.
But Monteforte and other critics contend that plans for the lion’s share of the expansion – shipping South Texas gas into the Mexican heartland – will assure Pemex’s grip on gas consumers for decades to come.
“If it flies I think Mexico’s gas market will remain in the hands of Pemex,” said Monteforte in criticizing the Texas pipeline proposal.
His company is building and will own a 225-mile pipeline from the border at El Paso to near Chihuahua City, he said.
“This will kill the opening of the gas market we’ve fought for since the 1990s,” he said.
The new U.S. pipelines, being contracted by Pemex’s MGI gas trading firm, will connect to a privately owned system being built across northwestern Mexico and to the much larger Los Ramones duct that will run from near the border at McAllen deep into central Mexico.
After sharp increases in the late 1980s and early ’90s, Mexico now imports some 15 percent of its natural gas supply from the United States, said Michelle Foss, program manager of the University of Texas’ Bureau of Economic Geology in Houston. By 2010, Mexico had increased its U.S. gas imports by 200 times what it did in the early 1980s.
Now, Mexico’s imports seem poised to spike again, perhaps bolstering prices for dry natural gas.
“Mexico will take all they can get and, as in the 1990s, could help to rebalance our market,” Foss said.
Project proposals for the South Texas pipeline – called the Agua Dulce to Frontera – were expected Monday. Pemex says the winning bid will be announced Sept. 18.
“For us it’s urgent to bring that gas,” said Guillermo Ortiz, a Mexico City executive who heads the energy committee at Canacintra, a leading Mexican industrial chamber. “They took a long time to contract for the pipelines. These types of situations are really hurting the consumers.”
- Mexico pipeline expansion may bring more money to Texas (fuelfix.com)
- Natural gas from Mexico beckons Texas companies (mysanantonio.com)
- Mexican Crime Syndicates Are Getting Into Stolen Petroleum (businessinsider.com)
- Will Texas oil companies get a shot at Mexico investments? (mysanantonio.com)
- Pemex’s El Perdido oil deposits may hold 10 billion barrels (fuelfix.com)
- Pena Nieto Push to Open Mexico Oil Fields Sparks Exxon Interest – Bloomberg (bloomberg.com)
- Mexico May Finally Get a Modern Oil Industry (businessweek.com)
G20 finance ministers need to stand in the way of European manipulation of the International Monetary Fund when they meet in Mexico City this weekend, PIMCO chief executive Mohamed El-Erian writes in a column published today in the Financial Times.
A staunch critic of Europe‘s attempts to get around its internal problems by relying on IMF funding, he argues that non-European economies need to stand up for the IMF’s professed “uniformity of treatment,” particularly given the harsh rules the organizations have imposed on emerging market countries in Asia and Latin America in the past.
A few choice snippets:
It should come as no surprise that over the last couple of years Europe has pressed the IMF very hard to make exception after exception – and it has succeeded. This has resulted in a number of firsts by an organisation that prided itself on the “uniformity of treatment” for member countries.
This is an internal issue that the IMF cannot, and should not be expected to, solve. It is up to the eurozone to decide whether to go forward in its current configuration towards a fiscal union or whether to first slim down to a more coherent and stable configuration. This would provide a better basis for a larger European-financed firewall.
As tempting as it is, Europe should not seek to obfuscate this critical decision by using IMF financing to give the appearance of sustaining the unsustainable. It must start making the necessary, albeit very difficult, decisions. Until this happens, the G20 has a global responsibility to protect the IMF from further damage to its credibility and legitimacy.
- El-erian: Greece = Argentina (businessinsider.com)
- EL-ERIAN To IMF: Man Up! (businessinsider.com)
- EL-ERIAN: The REAL Reason Europe Is Begging For Help From The IMF (businessinsider.com)
- EL-ERIAN: Even EU Leaders Know This Greek Deal ‘Will Only Last A Few Months At Best’ (businessinsider.com)
- El-ERIAN: Behold The Disorderly Advent Of A New Global Economic Order (businessinsider.com)
Eleven years later, President Felipe Calderon‘s government is furiously trying to flush out the man nicknamed El Chapo – “Shorty” – to rescue its bloody war on drug cartels.
Guzman’s flight from a maximum security prison in a laundry cart on January 19, 2001, was a major embarrassment to Calderon’s predecessor Vicente Fox, who had just begun a new era as the first National Action Party (PAN) official to lead Mexico.
Now, Guzman is the greatest symbol of the cartels’ defiance of Calderon, whose war unleashed a wave of gang violence that is eroding support for the PAN ahead of presidential elections on July 1. Calderon is barred by law from seeking a second term.
In the last few months, authorities have arrested dozens of Guzman’s henchmen, seized tons of his contraband and razed the biggest single marijuana plantation ever found in Mexico, subsequently chalked up as another setback for El Chapo.
Over Christmas, three senior Guzman associates fell into Mexico’s hands, including one named as his chief of operations in Durango, a state where he has been rumored to hide out.
“He’s certainly aware people very close to him have been captured over the past two weeks, so he must be seriously concerned,” said Vanda Felbab-Brown, a Brookings Institution expert on the drug trade. “The noose seems to be tightening.”
Since his nighttime escape, Guzman’s legend has grown daily, as the wily capo evaded capture, eliminated rivals and sold billions of dollars worth of drugs across the border.
Meanwhile, the PAN, who won office under Fox pledging to restore law and order in a country tired of the corruption that marred the 71-year reign of the Institutional Revolutionary Party (PRI), has become more and more bogged down in the drug war.
Calderon staked his reputation on rooting out the cartels, but the army-led struggle has cost over 46,000 lives in five years, spooking tourists and investors alike.
As Calderon fought to contain the violence, he had to watch Guzman feted for success when the kingpin placed 41st in a Forbes list of the world’s most powerful people in 2009.
Immortalized in song both in Spanish and English, Guzman seemed so untouchable that rumors began spreading the Mexican government had made a deal with him to keep the peace.
That talk has now faded, and Attorney General Marisela Morales said in October Guzman would be captured “very soon.”
North of the border, things have also turned sour for the fugitive trafficker, who made headlines as the world’s most wanted man after the death of Osama bin Laden.
In last few weeks, U.S. authorities in Arizona announced details of raids in which they arrested over 200 people linked to the Sinaloa cartel, named for the northwestern Pacific state where Guzman was born, probably in 1957.
DRUG LORD PROTECTOR
Surveys show the public backs the crackdown on the cartels. But it also believes Calderon is losing the drug war.
Alberto Vera, director of research at pollster Parametria, said only something of the magnitude of Guzman’s capture would persuade voters Calderon was winning. That could boost support for his party by two or three points if it happened not long before the election, he added.
“Catching him would do Calderon credit,” said Luis Pavan, 40, a Mexico City insurance agent. “Fighting the gangs is one of the few good things the government has done.”
Weakened by the mounting death toll, Calderon’s PAN lags the opposition PRI by about 20 points, recent polls show.
Capturing Guzman could also benefit U.S. President Barack Obama, who faces a tough re-election battle against Republicans that accuse him of being weak on border security.
Arturo R. Garino, mayor of Nogales – an Arizona border city lying right on Guzman’s main smuggling routes – said the kingpin’s arrest would be a boost to both governments. “Cutting the head off the snake would help our economy too,” he said.
Intelligence officials declined to say if efforts to catch Guzman had increased, but his biographer Malcolm Beith said there was little doubt they had, as recent operations on El Chapo’s turf were being conducted by crack military units. “It’s been special forces and marines to the best of my knowledge. These guys are called in for special raids because they’re less likely to have been infiltrated,” he said.
Officials who have tracked Guzman say it is one thing to locate him and quite another to capture him.
Like late Colombian drug lord Pablo Escobar, Guzman has a reputation as a protector of his heartland in Sinaloa, a rugged region that the state still struggles to penetrate, where news of approaching of strangers quickly reaches him and his followers.
“Chapo has allegedly paid for schools, hospitals, and other public projects,” said Beith. “Second, he’s just about the only source of employment in parts of Sinaloa. And he has provided security of a sort. He’s been known to apprehend small-time crooks or thugs when they got out of hand. Lastly, the name Chapo pretty much puts the fear of God into people.”
With locals watching his back, Guzman has always had just enough warning to get away at the last minute. The exception was when soldiers captured him in Guatemala in June 1993.
New surveillance technology has raised the stakes though.
Mexico has admitted allowing U.S. spy planes to track the cartels, reviving memories of the chase for Escobar, who was gunned down on a Medellin rooftop in December 1993.
The U.S. Army’s spy unit Centra Spike played a crucial part in that takedown – using planes to triangulate Escobar’s phone calls – and U.S. surveillance drones stationed just across the Arizona border are likely being used to help catch Guzman.
Adding to his problems are attacks from the rival Zetas gang, which has engaged in a spate of tit-for-tat killings with the Sinaloa cartel that have spread onto his territory.
If Guzman is caught, it could unleash a bloody scramble for power before the election, said Jose Luis Pineyro, a security expert at Mexico’s Autonomous Metropolitan University.
“He is said to have influence in five continents,” he said. “It would have repercussions outside Mexico and America.”
- Mexico to rescue its bloody war on drug cartels must catch El Chapo! (pikapvs.wordpress.com)
- Mexico furiously pursuing Joaquin ‘Shorty’ Guzman to save its bloody war on drug cartels (news.nationalpost.com)
- Zetas” Dominate More Territory Than “El Chapo” Included Chihuahua (socyberty.com)
- Mexican Army Says Cartel Ally’s Arrest Is Blow To ‘El Chapo’ (huffingtonpost.com)
- fugitive drug lord Joaquin Guzman, alias “El Chapo,” may be hiding out in the U.S. (pikapvs.wordpress.com)
- Mexican Army Says It Has Arrested Head Of Security For Drug Cartel Chief ‘El Chapo’ (theromangate.wordpress.com)
- Mexico Confirms Capture of Drug Lord El Chapo’s ‘Lieutenant’ (businessweek.com)
- Top Aide To Billionaire Druglord ‘El Chapo’ Captured (forbes.com)
By Associated Press, Updated: Monday, December 26, 4:26 PM
The alert goes out from a taxi driver or a street vendor, equipped with a high-end handheld radio and paid to work as a lookout known as a “halcon,” or hawk.The radio signal travels deep into the arid countryside, hours by foot from the nearest road. There, the 8-foot-tall (2-meter-tall) dark-green branches of the rockrose bush conceal a radio tower painted to match. A cable buried in the dirt draws power from a solar panel. A signal-boosting repeater relays the message along a network of powerful antennas and other repeaters that stretch hundreds of miles (kilometers) across Mexico, a shadow communications system allowing the cartel to coordinate drug deliveries, kidnapping, extortion and other crimes with the immediacy and precision of a modern military or law-enforcement agency.
The Mexican army and marines have begun attacking the system, seizing hundreds of pieces of communications equipment in at least three operations since September that offer a firsthand look at a surprisingly far-ranging and sophisticated infrastructure.
Current and former U.S. law-enforcement officials say the equipment, ranging from professional-grade towers to handheld radios, was part of a single network that until recently extended from the U.S. border down eastern Mexico’s Gulf coast and into Guatemala.
The network allowed Zetas operatives to conduct encrypted conversations without depending on the official cellphone network, which is relatively easy for authorities to tap into, and in many cases does not reach deep into the Mexican countryside.
“They’re doing what any sensible military unit would do,” said Robert Killebrew, a retired U.S. Army colonel who has studied the Mexican drug cartels for the Center for a New American Security, a Washington think tank. “They’re branching out into as many forms of communications as possible.”
The Mexican army said on Dec. 4 that it had seized a total of at least 167 antennas, 155 repeaters, 166 power sources, 71 pieces of computer equipment and 1,446 radios. The equipment has been taken down in several cities in the Gulf coast state of Veracruz and the northern states of Nuevo Leon, Coahuila, San Luis Potosi and Tamaulipas.
The network was built around 2006 by the Gulf cartel, a narcotics-trafficking gang that employed a group of enforcers known as the Zetas, who had defected from Mexican army special forces. The Zetas split from the Gulf cartel in 2010 and have since become one of the nation’s most dominant drug cartels, with profitable sidelines in kidnapping, extortion and human trafficking.
The network’s mastermind was Jose Luis Del Toro Estrada, a communications expert known as Tecnico who pleaded guilty to conspiracy to distribute cocaine in federal court in Houston, Texas, two years ago.
Using millions of dollars worth of legally available equipment, Del Toro established the system in most of Mexico’s 31 states and parts of northern Guatemala under the orders of the top leaders in the Gulf cartel and the Zetas. The Gulf cartel boss in each drug-smuggling territory, or plaza, was responsible for buying towers and repeaters as well as equipping his underlings with radios, according to Del Toro’s plea agreement.
- Mexican Drug Cartels Build Own National Radio System (huffingtonpost.com)
- Mexico’s Cartels Build Own National Radio System (abcnews.go.com)
- Mexico’s cartels build own national radio system (sfgate.com)
- Mexico’s cartels build own national radio system (seattletimes.nwsource.com)
- Mexican army captures drug cartel head “El Chapo” (ctv.ca)
- Mexico: ‘El Chapo’ Security Head Arrested (time.com)
- Mexican Army Arrests Cartel Security (myfoxphoenix.com)
- Mexican army captures drug cartel’s security chief – New Zealand Herald (nzherald.co.nz)
- 13 Bodies Found in Mexican Drug Cartel Battle (abcnews.go.com)
Mexican state oil company Pemex’s E&P subsidiary PEP will spend US$1bn in 2012 for the exploration of the Perdido fold belt in the Gulf of Mexico near the US border, PEP’s CEO Carlos Morales told reporters in a seminar in Mexico City.
The amount includes the drilling of three wells in the area, in addition to costs associated with delimitation of the field. First production from Perdido is expected some five years after hydrocarbons are discovered.
The area contains 3Bboe of prospective hydrocarbons resources, Morales said. In the entire Mexican deepwater Gulf of Mexico, Pemex believes it has 29.5Bboe prospective resources. It represents the company’s long-term hope for sustaining production, which has been falling since 2004 due to the natural decline of the giant Cantarell field and a lack of exploration.
Hydrocarbons that are produced would likely cross the maritime border into US waters to utilize existing infrastructure.
The company was expected to begin drilling of Perdido in 2011, but delayed arrival of the Bicentenario semi-submersible rig and concerns prompted by last year’s Deepwater Horizon spill pushed back the start of exploration.
Bicentenario began drilling its first well, Talipau-1, in 940m water depth in mid-2011 and will subsequently move to Perdido. The NOC awarded the five-year rental contract in 2007 to consortium Industrial Perforadora de Campeche and Grupo R Exploración Marina (Gremsa).
Pemex could also drill Perdido using the West Pegasus semi-submersible rig, previously known as Sea Dragon. The contract for the rig, signed with offshore driller Seadrill for a five-year term, also began this year.
Upstream regulator CNH’s commissioner Edgar Rangel told reporters in August that it planned to evaluate the Perdido area in the following months for potential approval.
By David Biller (Business News Americas)
- Perdido Subsea System (video) (mb50.wordpress.com)
- Shell Perdido: The first full field subsea separation and pumping system in the Gulf of Mexico. (video) (mb50.wordpress.com)
- Spar Transportation and Installation (video) (mb50.wordpress.com)
- Shell Perdido: moving the spar into place (video) (mb50.wordpress.com)
- Current Legal Framework for PEP and PEMEX (thepemexblog.com)
- At the Wellhead: once again, an effort to try to fix Mexico’s oil industry (mb50.wordpress.com)
- Repsol Rebuffing Pemex Spurs Foreign Bond Slump: Mexico Credit (businessweek.com)
- And the Winners Are…. Pemex Announces the Winners of the New Incentive Based Oil Exploration and Production Contracts. (thepemexblog.com)