Editor's Note: Please enjoy this bonus coverage from NGI's Mexico Gas Price Index, which includes daily prices, analysis and coverage of the emerging natural gas market in Mexico.
Mexico’s Environment Minister, Víctor Toledo, is the latest government official to voice support for President Andrés Manuel López Obrador’s plans to prohibit hydraulic fracturing, or fracking, through at least 2024.
Toledo, speaking at a forum in Mexico City in late November, said not only does the ministry consider unconventional drilling to be damaging to the environment, but it also backs the enactment of legislation that would completely ban the practice.
“We are going to work that legislation is created to prohibit the practice of fracking,” Toledo said. “There are proposals in each of the three congressional chambers that we are going to support.” For a law to be enacted, “a lot of things have to be modified, but it will be done slowly and deliberately because it will entail a lot of negotiations.”
According to Toledo, bills to prohibit fracking were submitted to three congressional chambers in late 2018 and again in July, although are yet to be discussed. In the event the bills were approved, the law would outlaw fracking and unconventional resource development, he said.
Toledo’s lobbying for a legal fracking ban, while aligned with the views of President López Obrador, differs with the opinion of many in the energy industry who consider unconventional drilling necessary for Mexico to achieve its goal of energy sovereignty. National Hydrocarbons Commission (CNH) Commissioner Alma América Porres said in October she considers unconventional resource development to be “the future of the hydrocarbons industry in Mexico.”
Proponents of unconventional drilling think Mexico would lose opportunities without the ability to use fracking. An estimated 57% of the country’s prospective oil and natural gas reserves are in unconventional plays, according to a CNH study issued in October. The study found that Mexico contains 112.9 billion boe in prospective resources, and 64.2 billion boe of that is in unconventional resources.
To read the full article and gain access to more in-depth coverage including natural gas price and flow data surrounding the rapidly evolving Mexico energy markets, check out NGI’s Mexico Gas Price Index.