US Lawmakers Call On Trump To Pressure Mexico To Honor Energy Commitments

More than 40 politicians sign a letter to the US president asking him to “find a resolution” to the Mexican government’s impediments to foreign energy investments

About 40 US lawmakers have increased pressure on their president Donald Trump to seek a solution to the Mexican governments efforts to limit private participation in the energy sector arguing that the spirit of the StatetoState Agreement is being undermined

States Mexico and Canada known as the TMec The 43 legislators petition comes days after documents were released in which the government of Andrés Manuel López Obrador allegedly asks regulators not to grant operating permits to private energy companies to benefit parastatals

Recent reports indicate that the Mexican government is granting preferential regulatory treatment to Petróleos Mexicanos PEMEX and is postponing or completely canceling permits for US energy companies says the letter sent this Thursday

These anecdotal experiences have recently received additional credit for a leaked memorandum from the president of Mexico Andrés Manuel López Obrador in which he instructs the Mexican authorities to use all available resources within the regulations to protect PEMEX and the Federal Commission of Electricity CFE Additionally members of the ruling Morena party have presented constitutional initiatives to reverse the historic Energy Reform of 2014 and seek to renounce all contracts currently in force

Downloadable letter from legislators in the US on the energy sector in Mexico
This is a first warning or a salvo says Pablo Medina an energy sector analyst at Welligence on the phone from Houston

It is a sign that AMLOs energy policy which has not necessarily followed the laws but rather has been through decree is raising alerts at the international level says the expert

Until now the López Obrador Administration has kept a very low profile with respect to Trump it has been quite careful not to antagonize him in any way however when it is seen that the interests of US companies governed by treaties that Mexico It is part which is the same treaty that the López Obrador Administration signed when it is seen that the rules are not being respected I think the consequences will be interesting explains Medina

I dont think this will bring immediate actions but it does raise the profile he adds

This week the CEO of Spanish energy company Iberdrola said in a meeting with investors that the company is ruling out new investments in Mexico until the regulatory framework is clarified

Asked about this prior to the publication of the letter in the US President López Obrador assured in his daily press conference that the change to the rules on energy was made because it was abused a lot

The purpose to put it clearly was to leave the energy market to the private sector both national and foreign and this implied diminishing undermining destroying ending Pemex and the Federal Electricity Commission said the president

They did the socalled energy reform to finish destroying Pemex and the Federal Electricity Commission and they cannot even say that thinking about the people because throughout the neoliberal period and especially since the socalled energy reform was approved Gasoline prices increased electricity prices did not benefit the people So now there is a policy change

This is the second letter that puts pressure on the Mexican presidents energy policy

Last year the Governor of the State of Texas Greg Abbott sent a letter to President López Obrador urging him to end the review of natural gas supply contracts to continue trade between the two countries Mexico is the main buyer of US natural gas in the world and much of this gas comes from Texas

The letter from the legislators is a reminder to the current Government that we live on a planet already fortunately with a maturity of international relations and in which the decisions that a country makes towards its interior could have collateral effects on the rest

of the world says Sergio Rivas consultant and president of the business promotion firm International Cluster of Energy in Mexico I welcome the international debate on the issues that the government is wrongly claiming to be solely of national interference

The energy reform designed and passed by the previous Administration of President Enrique Peña Nieto opened the sector to the participation of private companies for the first time in 70 years

The López Obrador government canceled renewable electricity auctions scheduled in the previous Administration and tightened the operating conditions for solar and wind plants in order to make the system reliable The decisions triggered criticism from the private initiative as well as from environmentalists

In the last debate between the two candidates for the US presidency this Thursday the former vice president and now Democratic candidate Joe Biden assured that his government would have an environmental agenda to fight against climate change that would include initiating the transition to energy renewables as well as international leadership to ensure that other countries comply with the reduction of carbon emissions

Oil has to be replaced by renewable energy over time Biden said I would stop giving them federal subsidies If federal subsidies are not given to solar and wind energy why do we give it to the oil industry He said

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