Four selected for invitation-only bid on new Tabasco oil refinery

The federal government has invited four companies to make bids to build a new US $8-billion oil refinery on the Gulf of Mexico coast in Tabasco.

Energy Secretary Rocío Nahle announced yesterday that the consortiums Bechtel-Techint and WorleyParsons-Jacobs and the companies Technip and KBR have been asked to participate in the invitation-only tendering process.

“Pemex selected the best refinery-construction companies in the world, those which demonstrated that they have extensive experience in the execution of these kinds of projects [as well as] technical capacity, economic capacity, quality and a transparent record of operational practices . . .” Nahle said.

She explained that the Secretariat of Public Administration (SFP) will collaborate with the Secretariat of Energy (Sener) and the state oil company in the process to assess the tenders, select a winner and oversee construction of the refinery at Dos Bocas.

The project is expected to create around 23,000 direct jobs, 100,000 indirect ones and be completed in three years.

Nahle said that environmental, topographical, geotechnical, hydrological and social studies of the 566-hectare site have been completed.

The energy-efficient refinery will have 17 separate plants, 93 storage tanks and green areas, among other features. It is expected to produce 340,000 barrels of oil a day.

The beginning of the tendering process for the Tabasco refinery – Mexico’s seventh – comes a month after President López Obrador announced a US $5.5-billion rescue package for Pemex, which has debt in excess of US $100 billion.

However, financial institutions described the bailout as insufficient and disappointing, while Fitch Ratings warned that it wouldn’t insulate the state oil company against future cuts to its credit rating.

Fitch downgraded Pemex’s credit rating to one level above junk in January, citing its substantial tax burden, high leverage and large capital investment requirements, among other factors, while Standard & Poor’s lowered its outlook for the company’s rating this month to negative from stable.

In October, Moody’s Investor Service warned that López Obrador’s plan to increase Mexico’s refining capacity and thus reduce exports of crude would further jeopardize Pemex’s financial position because its revenue in dollars would fall.

The rating agency said that Pemex’s increased income from gasoline sales would be in pesos whereas 87% of its debt is in dollars, a situation that is not only likely to weaken the oil company’s credit rating but could also significantly increase national debt.

Source: Milenio (sp) 

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