The amendment marks the most significant overhaul of Mexico’s oil and natural gas market in seventy-five years. It will allow foreign companies to engage in production and profit sharing agreements with Pemex, the state-owned energy company.
Karen Hooper is head of Latin America analysis at geopolitical intelligence firm Strafor.
“The law changes the constitution. The major changes that are going to need to take place will be in the secondary legislation that should be passed in the first half of next year. And that’s where we need to look and see exactly what kinds of contracts are going to be offered to foreign companies, what kinds of opportunities are going to be available. That’ll all be decided next year.”
Mexican oil production has been declining for about a decade. President Enrique Peña Nieto’s government is hoping the legislation will help reverse the decline — bringing an influx of capital and technological expertise.