ECONOMICS Bloomberg Businessweek June 17, 2019
rnment’sresolveand credits the policies
withreducingPemex’slosses from theft by 95%
sinceNovember,whichwilltranslate into $32.6 bil-
lioninadditionalrevenuethis year. Analysts ques-
tionhowPemexarrivedatthose numbers: “Greater
transparencyinthecalculation of this reduction
wouldbeuseful,”saysIxchelCastro of energy con-
sultant Wood Mackenzie.
Romero and AMLO met in the early 1990s in the
oil-rich state of Tabasco, where both got swept up in
a leftist movement that would go on to challenge the
Institutional Revolutionary Party’s 71-year monopoly
on power. When AMLO was elected mayor of Mexico
City in 2000, he tapped Romero to head the admin-
istrative office. A five-year stint supervising the
bureaucracy of the city was a dress rehearsal for his
current role. “Pemex makes a lot more money than
Mexico City, and where there’s more money, there’s
more corruption,” Romero said.
His strategy for cleaning up the company
involves “removing the head from the body.”
Replacing the top brass with his own team hasn’t
produced any discernible results on that front. In
fact, one Pemex veteran elevated into a top job was
forced to step down earlier this year amid reports
that he’d diverted billions of pesos in public funds
in his previous job at the company.the rn33for the compliance department. Romero should
be spending more time figuring out how to halt a
14-year slide in crude output. “You have to solve
everything at the same time,” says the money man-
ager. “You cannot solve one thing at a time.”
Analysts want to see a more concrete plan for
reviving production, especially after the new admin-
istration of López Obrador suspended auctions that
would have allowed Pemex to share the financial
burden of developing oil fields with private part-
ners. Investors also want guarantees that the $8 bil-
lion refinery the president wants to build in his
home state of Tabasco will not divert resources—or
management attention—from that task.
Romero’s most important achievement has been
a drastic reduction in gasoline theft, a long-standing
problem that worsened in recent years as drug car-
tels infiltrated the illicit industry. Immediately upon
taking office in December, AMLO, as López Obrador
is widely known, deployed soldiers to stand guard
over Pemex pipelines and launched an investiga-
tion into gas stations suspected of selling pilfered
fuel. The crackdown coincided with a pipeline
explosion in the state of Hidalgo in January that
killed more than 100 people who’d gathered there
to collect gasoline from an illegal tap.
Romero said the tragedy only cemented his and
120%600-60
2004 2018○ Change in Pemex
oil production, debt,
andcapitalexpenditure
since 2004
Production
Debt
Capex