Senators want US to approve Pemex oil swap

OREANDA-NEWS. A group of US senators is calling on the US Commerce Department to approve a request from Mexico's state-owned Pemex to swap 100,000 b/d of US light oil in exchange for Mexican heavy crude.

Led by Senate Energy and Natural Resources Committee chairman Lisa Murkowski (R-Alaska) and senator Heidi Heitkamp (D-North Dakota), the group of 21 senators called on US commerce secretary Penny Pritzker to approve the swap transaction as a way to increase energy ties between the US and Mexico.

"These potential transactions are in the national interest and, if applied for, should be authorized without delay," the senators wrote.

The senators want the US to further liberalize energy trade between the two countries by allowing for unfettered export of US crude to Mexico for use in that country.

In 1985 then-president Ronald Reagan determined that oil exports to Canada for use in that country would not threaten US crude supplies and would be in the US' interest. The group of 20 Republicans and 1 Democrat called on the US administration to follow Reagan's example "by issuing a similar finding that US oil exports to Mexico, for consumption in Mexico, are in the national interest."

The Commerce Department did not immediately respond to an inquiry about the letter.

Pemex said last month it was seeking to import US light crude to blend with domestically produced oil supplying three of its six refineries. The refineries that would receive the imported feedstock are the 430,000 b/d Tula in the central state of Hidalgo, 245,000 b/d Salamanca in the nearby state of Guanajuato, and 330,000 b/d Salina Cruz on the Pacific coast.

The crude produced from Mexico's two largest complexes — Cantarell and Ku Maloob Zaap — has been growing steadily heavier as the most accessible and highest quality hydrocarbons are depleted.

Pemex in January produced 2.251mn b/d of crude, according to a preliminary report from the company, compared with 2.353mn b/d in December. The company's crude production peaked at 3.5mn b/d in 2004.

US Energy Information Administration data through November 2014 show no US crude exports to Mexico since April 2002, when the US exports totaled 1,000 b/d.