Elimination of Maximum Price of Natural Gas First-Hand Sales
On June 19, 2017, the Energy Regulatory Commission (“CRE”) issued a communication approving the elimination of the maximum price of natural gas at first-hand sales.
The main purposes of the price elimination are the following:
a. The facilitation of the recovery of natural gas production.
b. That natural gas producers, among them, those awarded with exploration and production hydrocarbons contracts, may offer their additional gas production to the market.
c. That traders already having importation and transport capacity, may offer natural gas supply alternatives.
Notwithstanding said elimination, CRE will maintain a balance adjustment as a mechanism that allows the injection of liquefied petroleum gas to the Natural Gas Transportation System (SISTRAGAS, for its acronym in Spanish).
Additionally, the elimination will not imply the total deregulation of first-hand sales, since CRE will continue regulating such sales under terms and conditions, as well as contracts issued by PEMEX.
The Ruling whereby prices are being eliminated was published in the Federal Official Gazette on June 16, 2017.
The lawyers of the energy, mining and infrastructure area of our firm are available for any questions or comments on the above.
Juan Carlos Serra
Jorge Eduardo Escobedo Montaño
Jorge Garay Lebrija
Mexico City, June 22nd 2017