ASSESSMENTS

Mexico: Cantarell's Plummeting Output and the Need for Investment

Jul 7, 2008 | 19:08 GMT

Ronaldo Schemidt/AFP/Getty Images

Summary

Production at Mexico's giant Cantarell oil field has dropped 34 percent over the last year. Considering that Petroleos Mexicanos (Pemex) contributes up to 40 percent of the Mexican government's budget, the effects of a major production decline would affect the whole country. Mexican President Felipe Calderon has proposed legislation that will allow foreign investment in Mexico's energy industry, which will enable Pemex to expand Mexico's refining capacity and bring more oil wells online. As time passes, Calderon's proposal becomes more and more important for the Mexican economy.

Production at Mexico's Cantarell oil field has plummeted in the past year, indicating that time is running out for energy reform in Mexico....

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