CANACINTRA Calls Mexico's Energy Plan a "Simulation"

The National Chamber of the Transformation Industry Enoch Castellanos (CANACINTRA) has issued a warning against Mexico's National Energy Investment Plan, calling it "a simulation," according to an article by Mexico Business.

Even through the plan is yet to be announced by the federal government, CANACINTRA President Enoch Castellanos told reporters the chamber won't endorse it.

"We already said that as long bidding rounds for oil exploration, as long as there is no decisive action or explanation of what will replace the energy long-term auctions, we will not validate a simulation on energy," Castellanos said in an interview with the local press.

Initially announced to be ready by the end of January, the Energy Sector Investment Plan's launch was moved mid-February, yet the plan didn't take off and so far, there is not an official date for its publication.

The chamber president emphasized that there needs to be private investment since the current federal policies have failed.

"We need the opening [of the energy sector] to private investors, PEMEX exceeding MX$383 billion in losses is outrageous," Castellanos explained, stressing CANACINTRA's stand that the Federal Electricity Commission (CFE) and PEMEX can be strengthened, but not with public money.

In January, tensions also rose between CANACINTRA and the AMLO's administration as the chamber issued a rebuke of President Obrador's state-first energy policies, calling for the return of oil and gas bid rounds, according to an article by Natural Gas Intel.

The chamber stressed the importance of natural gas and electricity to the economy and warned against regulatory changes that favor Mexico's state-owned energy companies over their private sector competitors.

"We strictly oppose the historic regression that...the cancellation of bid rounds for hydrocarbon exploration and production blocks would represent," the group said.

CANACINTRA further called on the government to "strengthen the confidence of investors" through an energy policy based "on the framework of laws currently in effect."

They also warned that the government cannot boost the confidence of investors if they keep changing the rules from one day to the next.

For CANACINTRA, although Pemex and CFE played "a historic role" in Mexico's growth during the 20th century, the energy challenges of the modern world are too vast for state-run companies to take on alone.

Latest records show Mexican state oil company Petroleos Mexicanos (PEMEX) has continued to plummet with a $18.3 billion net loss for 2019, nearly double compared to that of 2018, accoding to report by Latin Post.

Puebla takes a stand on renewable energy

Amidst the issues surrounding the energy sector, the state of Puebla has initiated its own efforts to practice the use of renewable energy.

With the objective of promoting the use of renewable energy, Puebla has launched its new Energy Agency, which presented a MX$40 billion project investment portfolio to be distributed in different areas of the energy sector.

The Mexican state also pushes for a more sustainable and safe consumption that allows economic development with the support from the private sector.

Of the MX$40 billion planned investment, almost MX$30 billion is allocated for electricity generation projects, MX$8.4 billion for natural gas and more than MX$1.2 billion for oil logistics. To generate electricity from natural gas, Pueblo will expand the supply coverage to four of 21 industrial parks, as well push for the conversion of public transport to gas.

Such initiatives are backed by CANACINTRA, the industrial sector body of Mexico that aims to help companies increase their competitiveness and productivity as well as make sure they become socially responsible innovative agents.