Rampant Pipeline Thefts in Mexico Fail to Deter Onshore Oil Bidders Adam Williams - Bloomberg
go to original December 13, 2015

Mexico’s oil thieves cost industry billions of dollars (CCTV America)

Five incidents of pipeline theft a day, a rate that's almost doubled in the last two years, isn't fazing potential bidders seeking to produce oil from onshore fields in five Mexican states.

A record 79 private companies, including Engie of France and Pacific Exploration and Production Corp. of Colombia, have qualified to bid in the Dec. 15 auction now that Mexico's new laws have opened oilfield development to private companies. That compares with 20 companies that qualified to bid in the country's Sept. 30 offshore auction, underscoring how the chance to enter Mexico's nascent oil market is outweighing risks.

"I'm not too concerned about security at this stage," said Stefan Olivier, CEO of London-based MX Oil. "We are very interested in Mexico and we are going to be bidding" in the Dec. 15 auction.

Mexico's state-owned oil producer Petroleos Mexicanos documented 3,600 illegal taps on pipelines in 2014, a 40 percent increase from the 2,627 a year earlier, costing the company an estimated $792 million in stolen fuel. The taps are used to siphon out oil and gasoline in transit.

Pilfering more than quadrupled from 2009 to 2013, according to Pemex, as the company is known, which partially attributes its 11-year slide in crude production to the increase in illegal taps. Mexico is on pace to exceed a record 4,000 incidents of pipeline theft this year, up from 710 in 2010.

Read the rest at Chicago Tribune

Related: New Oil Industry-Crime Law Will Likely Prove Ineffective (El Daily Post)

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