Speed and Consistency: Taking Stocking of Oil & Gas Reform in Mexico

Speed and Consistency: Taking Stocking of Oil & Gas Reform in Mexico

It is often difficult to stop and take stock of a major initiative while it is underway. But that is what is occurring in Mexico as the year draws to a close and the nation charges forward with its historic energy reform efforts. Lessons learned from the public bidding process of Round One, as well as measures to rewrite the regulatory and investment framework continue to be organic, that is living and evolving. And the government has displayed an earnest desire to adapt and rethink its vision as milestones are reached and challenges emerge. Particularly with regard to upstream tenders, global insights from industry and stakeholders have been well-received.

On November 18, over 75 representatives from the Mexican government, industry, academia, and civil society convened in Mexico City for the Institute of the Americas’ Mexico Oil & Gas Roundtable. The Roundtable offered a robust half-day discussion of key issues and focused on the question of: What is the vision?

 

As the country moves along the process of tendering oil and gas blocks, as well as throwing open its midstream and downstream sectors of the hydrocarbons chain, there have been immediate lessons learned. Of the myriad practices being absorbed in Mexico, government officials noted that three stand out: 1) Oil and gas is first and foremost a geology business; 2) Striking the right balance between risk and return for oil and gas investment demands never-ending consideration and evaluation; 3) The oil and gas business is a global one and thus competition for investment and capital occurs not on a regional but rather a global scale and stage.

Throughout the Roundtable, plaudits from industry participants were underscored by the government for the speed that energy reform is being implemented. But at the same time, there were voices that noted caution is required in order to insure that the current pace provides for a consistent and sustainable path.

Panelist at the Mexico Oil and Gas Institute of the Americas RoundtablePanelists urged the government to take care and be careful not to overreach and create an environment where it is more of a running-in-place mentality as opposed to forward progress as the increasingly complicated layers of energy reform unfold. Clearly, there are concerns of overburdening the government bureaucracy and overextending nascent agencies. How much additional bandwidth exists and can legitimately be tapped in the coming weeks and months must be considered.

In the opinion of several participants, the next 12 months will determine not just the success of energy reform, but also go a long way to defining the next 12 years for Mexico’s oil and gas sector. Indeed, when it comes to the most appropriate contract model for the upcoming tender of deepwater blocks the focus should be on creating the environment for a “good contract.” This means less concern over the contract model itself and more focus on the elements that will make bidding attractive, competitive and balanced with returns for the nation. Clearly, the government has a greater appreciation for the nature of global competition than it did earlier this year. The development and publication of the Plan Quinquenal or Five Year Oil and Gas Exploration and Production Plan marked an important step as to the vision for industry and the nation alike.

Beyond the issue of competition and drawing up balanced investment opportunities, the issue of social impact and role of local communities has also been thrust to the fore as a key challenge for the implementation of energy reform.

The reform legislation created important legal instruments and regulations to manage social and environmental impacts, but government officials admitted that staff levels, attention to and understanding of the topic may not be commensurate with the sheer magnitude of the challenge. The opening of the energy sector has created a new horizon for investment, and increased the number of sector participants, projects and infrastructure in communities with little to no understanding of or exposure to the basics of interaction with private firms or even federal energy authorities. It is a concern that government and industry alike share and agree requires increased attention.

Collaboration across all facets of industry, government and civil society is necessary, with all parties sharing responsibility. The concept of a social license to operate and what that entails merits further awareness. Indeed, as with the bidding and investment elements, there are a host of international examples to draw from with regards to best practices for community relations and avoiding costly and undesired unrest across the country.

Journalists Create Periodismo de las Americas Network

Journalists Create Periodismo de las Americas Network

LA JOLLA – Investigative journalists from eight countries in Latin America and the Caribbean who attended a Nov. 10-14 professional workshop at the Institute of the Americas have formed a network to encourage and strengthen in-depth reporting on political, economic and environmental issues confronting the region.

The network, which the journalists named Periodismo de las Americas in recognition of the IOA workshop which was the impetus for forming the journalist organization, is open to reporters and editors through

out the region, said Marjuli Matheus, who serves on the board of directors of the National Association of Journalists in Caracas, Venezuela.

“We are very excited to apply everything that we learned and to be able to put into effect something tangible as a result of the workshop,” Matheus wrote in an email to IOA Vice President and Journalism Program Director Lynne Walker. “The name that we chose for the network is to honor the Institute, which gave us this opportunity.”

Matheus was one of 22 journalists who attended the five-day workshop, which focused on reporting and interview techniques, the use of data bases to conduct investigative reporting, social media tools and techniques for reporting breaking news stories, the dangers of covering organized crime in the U.S-Mexico border region and techniques to report such stories without putting journalists lives at risk; environmental and health investigative coverage; and journalism ethics.

The journalists attended from countries throughout the Americas – from Mexico, Guatemala, Costa Rica, Panama, Colombia, Venezuela, Peru and Cuba.

Journalists who attended the November workshop at the Institute of the Americas have formed a network to encourage and strengthen in-depth reporting.

Jessica Osorio, a journalist with Siglo 21 in Guatemala, said, “Given the situation in Latin America,  providing journalists access to a workshop that equips them with the necessary tools for the exercise of their profession is essential to strengthening the processes of transparency and accountability. The media and access to information are essential tools to create public awareness and empowerment of society. If journalists continue training themselves through these activities, and even more through one of the most important organizations such as the Institute of the Americas, they will contribute to the development of their countries.”

During the week, the journalists met with expert speakers such as Andrew Becker, national security and border issues correspondent with California-based Center for Investigative Journalism; Pedro Enrique Armendares, executive director of Mexico City-based Center for Investigative Journalism; Robert Hernandez, visual journalist and professor at USC’s Annenberg School for Communication and Journalism.

They also discussed investigative journalism techniques with Alfredo Corchado, Mexico City Bureau Chief for the Dallas Morning News and author of the recently published book, Midnight in Mexico; Susan White, executive editor of InsideClimateNews.org; Lynne Friedmann, editor of ScienceWriters magazine; Victor Clark Alfaro, director of the Bi-national Center for Human Rights in Tijuana; Adela Navarro, co-publisher of the Tijuana weekly newspaper Zeta; and Vicente Calderon, founder of TijuanaPress.com.

Pedro Enrique Armendares, executive director of the Mexico City-based Center for Investigative Reporting, spoke about the use of data bases as Costa Rican journalist Arnold Zamora, far left, looked on.

Journalists attending the workshop said the veteran editors and reporters who met with them during the workshop presented  a wide range of information and professional advice that will help them as they work on in-depth stories in the future.

“Activities such as the Investigative Journalism workshop organized by the Institute of the Americas  give us the opportunity to learn from excellent journalists and professors,” said journalist Mercedes Agüero, with La Nacion in Costa Rica.  “And, perhaps more important, they allow us to create networks with colleagues from other countries with whom we can collaborate, publish our work, share experiences and spread our knowledge.”

The journalists established the Periodismo de las Americas network immediately after returning to their newsrooms from the Institute’s Investigative Journalism workshop.  They now have a blog, which can be viewed at http://periodismodelasamericas.blogspot.com/

They also established a Twitter account, which is @periodismodla

And they have a FaceBook page at https://www.facebook.com/PeriodismoDLA and a page on Google Plus at http://goo.gl/DS2igS

Matheus encouraged journalists in Latin America and the Caribbean to publish their work on the blog.  The only requirement, she said, is that journalists send a brief bio about themselves and their media organization.  Journalists can send the information to periodismodelasamericas@gmail.com

The founding members of Periodismo de las Americas hope that their efforts will expand from a regional network to training programs for journalists in the Americas.

“Our idea for the future is to be able to offer training in countries in Latin America so that we can reach more journalists,” Matheus said.

Certainty and Opportunity in Mexico’s Evolving E&P Landscape

As Mexico celebrates two years since the nation embarked on its momentous energy reforms, the oil and gas sector has much to commemorate and much on which to reflect. The lackluster opening of Round One in
July ultimately enabled competitive bidding as the government responded to concerns and criticisms in the second tender process that concluded in September. The outlook for Mexico’s reforms remains positive, in part due to the efforts by regulators and officials to ensure transparency at every level. Still, some concerns persist, particularly in the area of social impact and community engagement. As Mexico moves forward, the government must build on early successes while ensuring the legal, regulatory, and judicial certainty that will buoy investor confidence and guarantee further progress.

Certainty and Opportunity in Mexico’s Evolving E&P Landscape

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