Mexico's Pemex Reports $1.3B 3Q Net Loss

MEXICO CITY (Dow Jones Newswires), October 29, 2008

Mexican state oil firm Petroleos Mexicanos reported a net loss of $1.3 billion during the third quarter of this year.
In a Tuesday filing to the Mexican Stock Exchange attributed the poor results to exchange rate losses. Pemex reported at $1.2 billion loss during the year-ago period.

On Tuesday Congress gave its final approval to an energy reform designed to boost oil output by giving Pemex more autonomy in setting its budgets, raising capital, and hiring outside companies for fee-based service contracts.

Since 2004 Mexican oil production has fallen by nearly 700,000 barrels a day, to just over 2.7 million barrels a day as of September. The country needs to find and develop new pools of oil fast in unexplored areas such as deep waters of the Gulf of Mexico to reverse the trend.

Pemex said it had $1.1 billion in exchange losses in the third quarter due to the Mexican pesos' sharp fall compared to the U.S. dollar during the quarter.

Sales rose 26.3% on year to $33.9 billion, thanks to higher crude prices, compensating for a decline in oil production. But the cost of sales rose 38.5% to $14.8 billion, mainly due to a steep rise in the cost of imported fuels such as gasoline and diesel.

Pemex imports around 40% of the gasoline and other transportation fuels it sells.

Tax and royalty payments rose 37.7% compared with the year-ago period, to $22.9 billion, or 67.7% of total sales.

Total bonds and bank loans fell 3.1% to $48.2 billion. Total liabilities, including labor debt, fell 3.5% to $108.7 billion, in part due to changes in accounting rules. Pemex

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