On June 28th, the British Chamber of Commerce in Mexico hosted a breakfast-conference in the Marquis Reforma about Midstream: Challenges and Opportunities in the Energy Reform.
Panelists were: Francisco Guajardo, Oscar López Velarde from EY, Alejandro Sole from Artha Capital, Hector Garza from, and Sebastiaan Schuite from FERMACA, Rafael Daryanani from DIDSA moderated the panel.
Emilio Diaz , from EY and President of the BCC welcomed attendees and thanked them for their presence, followed by Rafael Daryanani who briefed about Midstream and announced the upcoming Energy Day event on September 27th.
The panel began with each of the panelists feedback and point of view from where there companies are standing, Francisco Guajardo remarked that eliminating practices was essential on a local level in order to accommodate for the international market, through experience improving quality internationally, and embracing new international companies. Oscar López Velarde pointed out that before the reform, there were more developments in advances in natural gas, but since the reform, things have been a bit slower in development, fiscal problems for energy companies are having a global effect on the industry. Alejandro Sole shared that energy companies need to take a more active role in the developments following the reform, going through a period of transition that even with or without the reform, is a key period and an important stage for the energy sector.
Hector Garza said that there are social impacts of the energy sector and the reforms and they have to be taken in consideration for example local communities and indigenous communities. Travelling to other countries is an important way to understand the sector and how they are dealing with social impacts in other areas of the country and other countries. Also government regulations are changing the face of the sector. Sebastiaan Schuite mentioned he has worked in many places across Mexico, he said that the matter of the reform is a delicate subject, in regards to where the energy sector is concerning the specific laws and regulations.
Q&A session addressed the effects on the local level like workforce problems, improving staff training, alliances with academic institution, technology, putting strategies in place, project social and environmental factors, ducts and terminals, the role PEMEX is playing, ducts and terminals renting from PEMEX.
There are risks in both old and new, financial, technical etc. Also, facing problems which are arising in small places converting into bigger problems, for example maintenance in ducts. Small projects are turning into an interesting and attractive theme.
The guests talking and enjoying their breakfasts
Medium-long term developments in Mexico
Taking the politics of medium to long term developments seriously and always acknowledging the social impacts and significant changes due to the developments.
The needs of the natural gas market, expanding creativity and understanding the market better. There is a need to share experiences and feedback from other countries e.g. Colombia. Currently Mexico is far behind other countries, but the reform opens up opportunities for change and set the table for huge developments and a new infrastructure for natural gas.
Midstream – not just ducts and terminals
Midstream is also about improving products and the extraction of materials in different ways, but is it cost effective? Projects are advancing, and the reform is seen as an opportunity to develop and explore new possibilities.
What are the most difficult regulations to overcome and what has encouraged new projects?
Income is not being generated in certain regions, and the extraction of small amounts in specific areas is politically OK but economically doesn’t make sense. The energy sector is waiting for new regulations to be published, and how they will affect future projects and the role to take into account regarding the communities that are affected by the new projects.
Challenges for the future
To close the event panelists concluded that we have to engage in the next few years, with a focus on contributing to the community and commitment to the future, and thinking outside of the box and thinking creatively