MEXICO CITY — Mexico's state-owned oil company says it will form an entity to produce shale gas and deep-water oil in U.S. territory.
The plan will help Petroleos Mexicanos, known as Pemex, acquire drilling techniques it now lacks for complicated terrain in Mexico, chief executive Emilio Lozoya said in an interview with The Wall Street Journal.
Pemex confirmed the plan Monday.
“The geology is similar and we can benefit from numerous areas of collaboration with international oil companies,” Lozoya said.
Pemex has so far been unable to exploit its shale and deep-water reserves, and the Mexican Constitution limits its ability to hire outside expertise in Mexico. The government has proposed allowing Pemex to enter profit-sharing contracts with private companies and let outside companies refine and transport oil inside the country.
That would require controversial changes to the constitution, which states that Mexico's oil belongs to the state.
Mexico's largest leftist party is leading opposition to opening up Pemex to more private investment.
Monday, the Democratic Revolution Party, or PRD, presented its own plan to fix the ailing, outdated oil company.
Instead, the Democratic Revolution Party is proposing to loosen the government's hold over revenues from Pemex, where 70 percent of profits go to fund the federal budget.
Party founder and former presidential candidate Cuauhtemoc Cardenas also said Pemex should be made more independent by removing Cabinet secretaries and the oil workers union from Pemex board seats.
Cardenas is the son of the late President Lazaro Cardenas, who nationalized the oil industry in 1938.
Mexico's rate of oil production has dropped by about one-quarter over the last decade.