Mexico and UK Form Strategic Partnership in Global Energy Reform Initiative
Landmark deal shows Mexico is committed to implementing its sweeping reform policy
Over the last couple of years, Mexican President Enrique Peña Nieto has become known on the global stage for his country’s sweeping energy reform. At first, many were weary of the legislation, citing that it was, perhaps, too ambitious.
However, it looks like Mexico’s newfound go-getter attitude is proving quite advantageous.
Mexico and UK Energy – The Partnership
Once Mexico decided to privatize its energy sector, after nearly 80 years of a monopolized market, it was made clear that the country’s oil and gas industry was prepared to evolve. What has since followed has essentially paved the way for the nation to become another global energy force.
President Peña Nieto took the next step in his quest for energy independence and affirmed his country’s stance in the energy sector earlier this year, during a three-day state trip to Britain. In early March, right around the time that the second phase of Mexico’s Round One auctions started, the country’s energy reform initiatives made headlines once again, with the president striking a landmark deal with the United Kingdom and Prime Minister David Cameron.
The deal, which was widely lauded by the global energy industry, has been a strategic first step in a closer collaboration between the Europe and other global oil and gas providers. It is also the first key strategic partnership to be secured in the Mexico’s quest for energy independence. Under the agreement, the UK agreed to provide Mexican energy companies with a hefty $1 billion credit line for purchasing British technology.
The oil and gas industry in Britain, particularly Scotland, is widely considered to be among the most innovative across the globe, and has been acclaimed for its expertise and academic skills. Currently, the UK ranks first in the world in offshore wind technology.
On the other side, initial projections for Mexico’s energy reform indicated that the state could bring in as much as $50 billion of investment by the year 2018, which would serve as a strong catalyst for economic development. This, paired with the UK’s strong energy policies and practices, has created one of the most fascinating partnerships in the industry today.
The Green Pledge
However, the deal isn’t just about dollars and cents. Although Europe is currently working to multiply its fuel supply sources in an effort to separate itself from Russian oil in the wake of actions in Ukraine, Mexico and the UK have both pledged to proactively combat climate change through low-carbon initiatives.
Such initiatives were a critical part of the energy agreement struck in Scotland. Specifically, both powers included provisions for educational programs, with an arrangement between Aberdeen University in Scotland and Mexican state oil giant, Pemex, being put into place in order to provide training to industry specialists regarding the most up-to-date green practices. Experts have indicated that these provisions provide robust educational opportunities for both powers.
Quite simply, Mexico and the UK are invested in forming a mutually beneficial relationship in the global energy sector. The newfound partnership could not come at a better time for Mexico. Just as many began to question if the country’s reform policy could weather plummeting oil prices, the joint venture with the UK appears to have confirmed that Mexico’s energy sector is in it for the long haul.
Sustaining this notion was former Mexican President Vicente Fox, during a scheduled visit to San Antonio, Texas on March 16. While in the states, Fox addressed critics of his country’s reform initiatives, particularly those speculating that low oil prices would deter foreign investment. In his address, Fox stressed that Mexico’s energy reform was a long-term investment for the country, as well as potential investors, that could weather even the most cyclical of markets.
Fox affirmed the same ideals that Peña Nieto demonstrated with energy leaders and Prime Minister Cameron in Aberdeen. Now, more than ever, it is clear that Mexico is determined to cultivate a lucrative and resourceful oil and gas industry that can sit at the table with the global players.
With more than 18 years experience in translation and interpretation, Flor Dimassi, CEO of GlobalSpeak Translations stays on the pulse of what is happening in the international oil and gas arena. She turns language and cultural diversity into business opportunities for her clients. Learn more at www.globalspeaktranslations.com