Mexican Cartels Steal Billions From Oil Industry

Mexican Cartels Steal Billions From Oil Industry
As Mexico prepares to develop shale fields and attract foreign investors, another challenge awaits: taming the brutal drug cartels that are stealing billions of dollars' worth of oil from pipelines.

CIUDAD MIER, Mexico (AP) — Mexico overcame 75 years of nationalist pride to reform its flagging, state-owned oil industry. But as it prepares to develop rich shale fields along the Gulf Coast, and attract foreign investors, another challenge awaits: taming the brutal drug cartels that rule the region and are stealing billions of dollars' worth of oil from pipelines.

Figures released by Petroleos Mexicanos last week show the gangs are becoming more prolific and sophisticated. So far this year, thieves across Mexico have drilled 2,481 illegal taps into state-owned pipelines, up more than one-third from the same period of 2013. Pemex estimates it's lost some 7.5 million barrels worth $1.15 billion.

Pemex director Emilio Lozoya called the trend "worrisome."

More than a fifth of the illegal taps occurred in Tamaulipas, the Gulf state neighboring Texas that is a cornerstone for Mexico's future oil plans. It has Mexico's largest fields of recoverable shale gas, the natural gas extracted by fracturing rock layers, or fracking.

Mexico, overall, is believed to have the world's sixth-largest reserves of shale gas — equivalent to 60 billion barrels of crude oil. That's more than twice the total amount of oil that Mexico has produced by conventional means over the last century.

The energy reform passed in December loosened Mexico's protectionist policies, opening the way for Pemex to seek foreign investors and expertise to help it exploit its shale fields. It hopes to draw $10 billion to $15 billion in private investment each year.

The attractiveness of the venture may hinge on bringing Tamaulipas under control.


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Renato | Sep. 26, 2014
Is it that hard to find out who is buying all this oil? Since all refineries are in the US, the FBI should be able to get some quick leads.

Sean | Sep. 25, 2014
This will prevent most investment from ever occurring in the region. The government of Mexico must not just vote in investment. They must make it attractive for investors. It is a shame that these resources will not be developed until the problem is solved. There is some very good rock on that side of the river.


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