Mexico Pemex Q4 loss grows on lower fuel prices, asset revaluation

27 February 2014 20:14  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Petroleos Mexicanos (Pemex) posted a Q4 net loss of Mexican pesos (Ps) 76.5bn ($5.76bn) compared with a smaller year earlier loss of Ps28.8bn, mainly due to a 2.4% decrease in the price of regular gasoline in the Gulf of Mexico, the state-controlled oil and petrochemical major said on Thursday.

The company’s bottom line also took a Ps25.6bn hit after the value of certain assets was reduced, mainly in the Burgos natural gas field in northern Mexico, Pemex said.

Total sales in the quarter reached Ps409.5bn, down by 2.6% compared with sales of $420.6bn in the prior-year period. Domestic sales slipped by 1.6% to Ps231.6bn, while exports decreased by 4.6% to Ps175.0bn, the company said.

For all of 2013, Pemex posted a Ps169.1bn loss versus a profit of Ps2.6bn in the previous year, mainly as a result of reduced crude oil prices, lower crude volumes and a 3.2% drop in the price of regular gasoline, the company said.

In the fourth quarter, total crude production averaged 2.52m bbl/day, a 1.5% decrease compared with the same period in 2012 due to natural declines in light and heavy crude output, while natural gas production rose by 1.6% to an average 5.75 billion cubic feet (bcf)/day.

Crude processing decreased by 2.1% over the quarter to 1.16m bbl/day as a result of programmed maintenance cycles and non-programmed overhaul works, Pemex said.

The company produced an average of 1.34m bbl/day of refined products in the period, up by 2.5% year on year amid an increase in automotive gasoline, diesel and liquefied petroleum gas (LPG) output.

During the quarter, production of petrochemical products increased by about 13% year on year to 1.29m tonnes mainly due to gains in the aromatics and derivatives chain, the ethane derivatives chain and propylene and its derivatives chain, Pemex said.

This was offset by a decrease in production in the methane derivatives chain, mainly ammonia, as bad weather hit agricultural zones in the northeast of the country, reducing overall demand.

In December, Mexico’s Congress approved a landmark energy reform bill that will open up the country’s oil and gas sector to private and foreign investment for the first time in 75 years.

The nation’s lower house is currently drafting secondary legislation to implement the reforms, according to Pemex.

On 21 December 2015, and in accordance with this legislation, Pemex will be converted from a decentralised public entity to a “productive state-owned company”.

By: Simon West

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