Mexico violence costs $350K daily in natgas losses

Businessweek ^ | November 11, 2010 | MARK STEVENSON

[SwinneySwitch]

MEXICO CITY

Threats and violence by drug gangs are preventing some government oil workers from reaching installations in northern Mexico and costing state-owned Petroleos Mexicanos about $350,000 every day in lost production, a company official said Thursday.

The official said Pemex has shut down the equivalent of about 100 million cubic feet of natural gas production per day. He talked to The Associated Press on condition of anonymity, because company rules do not allow him to be quoted by name.

That amounts to about $10.5 million per month, or about 2.3 percent of Mexico's $450 million per month average in monthly natural gas revenues.

The lost production is centered in the Burgos gas field near the east Texas border in an area where drug gangs have threatened and kidnapped Pemex workers at some the company's installations.

The official said that earlier in the year, when the security problems were most acute, gas production was down twice as much -- about 200 million cubic feet per day.

The problem came to a head in May, when five workers at a gas compression plant were abducted by armed men. The father of one of the victims has said the workers were warned to stay away, and the kidnapped men have not been heard from since.

The kidnappers are believed to belong to either the Gulf or Zetas drug cartels, which are waging a bloody turf war in northern Tamaulipas state, chasing many inhabitants from their homes. It's not clear which gang nabbed the workers.

However, army troops are now helping Pemex provide increased security.

"This has allowed us to start partially recovering the production we had stopped for this reason," Pemex exploration and production division chief Carlos Morales told local media.

[elpinta]

IF we would allow non-corrupt enforcement (is there any) to just go for it, this could be exterminated.

I think there are just too many Mex/US ‘entities’ making a killing (literally and otherwise) so this cannot end.

[Bullish]

I get a huge kick out of the commercials I'm seeing on TV here in SoCal recently. They feature happy smiling American families frolicking in the surf and sun on a Mexico beach, saying "come enjoy a Mexico vacation" or some such nonsense. They conveniently forget to tell you that Mexico is controlled by ruthless, bloodthirsty drug cartels that would kidnap and kill you for a few Pesos.

Everytime I see one I have to wonder who in the heck is so ill-informed and dumb enough that they would travel to that hellhole just for a cheap vacation.

[jmacusa]

I think it’s only a matter of a few years, five at the most, before Mexico implodes/explodes and collapses entirely. That is if the present situation doesn’t change. And that doesn’t seem likely. Mexico has never been a country based on the rule of law and it’s citizens have no understanding of what law means and no apparent desire to find out. There’s Hell on the horizon coming from this pest-hole south of the border and America isn’t prepared for it.