Mexican Energy Reform/Investment by Private Companies

As an update to the Mexican Energy Reform recently passed by Mexican lawmakers and State Legislatures, please be advised that on Friday, December 20, 2013, the Ministry of the Interior published in the Official Gazette of the Federation the Decree that reforms and adds several provisions of the Mexican Constitution on the subject of Energy.


Herein below please find the 10 most important highlights of the Energy Reform.


1 – Sets the control and planning of public power system and opens the door to individuals to enable them to participate in the activities of the electricity industry.

2 – On the subject of Hydrocarbons, it opens the possibility of executing contracts with public and private companies.

3- The Mexican Petroleum Fund is created for the Stabilization and Development that shall administer and distribute the proceeds from the contracts that are executed regarding energy.

4 – The National Hydrocarbons Commission and the Energy Regulatory Commission will be the regulatory bodies.

5- A governmental control is maintained over the transmission and distribution of electricity.

6- The Federal Electricity Commission (CFE) and Petróleos Mexicanos (Pemex) will become “productive companies of the Government”, a change that will be regulated thereafter with additional laws, with a maximum term of two years.

7 – The Ministry of Energy is responsible for granting to Pemex the exploration areas, including those that are already operating, and Pemex must demonstrate “technical, financial and execution capabilities” necessary for the operation.

8 – Pemex has a period of ninety days once the Bill is in effect in order to submit the requests in the areas that it wants to reserve and the Ministry of Energy shall issue its decision within a maximum period of 180 days from the date that Pemex submits the corresponding request.

9 – In the case of Pemex, the board shall consist of five members of the Mexican Government, including the Energy Ministry, who will preside the board, and five “independent directors.”

10 – The Oil Union, led by Carlos Romero Deschamps, will no longer be a member of the board of directors of Pemex.

For further reference please go to to view the Spanish version of said decree.




Ernesto Velarde Danache, Inc.