Petroleum industry in Mexico

140:, which allowed private land companies to survey public lands for the purpose of subdivision and settlement. For their work surveying this public land, the company would receive one-third the surveyed land, and gave them the opportunity to buy the remaining two-thirds at a very low cost. This allowed more than 132 million acres of Mexican land to be owned by the surveyors. By the early twentieth century the reapportionment was complete. The law divided former communal land and large estates into small, privately owned lots. Dealing with private landowners made it easier for foreign oil companies to buy or lease oil property. Many property owners considered the up-front bonus they received for leasing their property to be “easy money.” A typical oil lease allowed the property owners remain on the land; if the company did not start producing oil from the land within the term of the lease, commonly five years, the company would leave, and the owner still had the lease bonus money. 271:"Faced with political difficulties in Mexico, as well as the intrusion of saltwater into some of the major producing field, the United States and other foreign oil companies began to seek other sources of supply particularly in Venezuela, and interest in the middle east intensified as well." Foreign oil companies continued to pump as much oil as quickly as possible for exportation, until the Mexican expropriation in 1938, “Ignoring reasonable conservation measures to export as much oil as quickly as possible”. “Mexico only found itself compelled by the rebellious and defiant conduct of the oil companies that is decreed the expropriation of their properties.” The United States refusal to recognize and work with Mexico's post-revolution government, along with a very hazardous work environment that lead to workers strikes and revolts, forced the Mexican government to expropriate the land. 1084:, a typical oil town in Mexico, was the subject of a study that revealed the difficulties associated with living in an area dominated by petroleum drilling. The inhabitants of Poza Rica are constantly renegotiating their everyday lives to fit the changing landscape around them; this includes practicing large and small safety measures, ignoring toxic smells in the air, and recovering from the loss of jobs when oil fields are retired. Any area with drilling present became a town in which it was believed deadly accidents could occur. However, people often compromised to remain in their homes, ignoring or simply accepting the potentially dangerous side effects. 184:

Article 27 would be applied retroactively, leading to expropriation of oil rights by the Mexican government. At the end of World War I, the United States was concerned with rapid exhaustion of domestic oil resources. United States imports of crude oil, nearly all of it from Mexico, rose rapidly from 30 million barrels in 1917, to more than 100 million barrels per year from 1920 to 1922, before declining. The demand for Mexican oil imports was increased by the United States conservation of oil movement. The United States saw Mexican oil as an opportunity and the US business interests were heavily backed by the United States government

229: 240: 39: 840: 656: 1117: 1103: 28: 1076:. Other blowouts that followed the incident at Dos Bocas continued to damage the surrounding area's vegetation, wildlife, and general ecosystem. Often, these small-scale fires and spills are viewed as insignificant to the grander environment, which many believe can heal itself. However, the consequence of many small events, according to theorists, is a lasting impact that may not be curable. 1091:, a native population in the area, fought to hold their traditional practice of agriculture when oil companies entered their homeland. The native population's land was often taken without respect for the centuries of native presence there, turning pastures and forests into oil camps. The natives viewed this change as an unhygienic and cruel transformation from forest to industry. 1068:, the local village, as the explosion rocked the area. After burning for over a month and killing a small number of people, the Dos Bocas fire created a dangerous area that most residents avoided. Besides the rumors and superstitions that characterized the locals' discussion, the event had significant environmental impacts as well. 1045:. With the onset of petroleum mining in the early twentieth century, environmental impacts escalated. While foreign powers were often successful in shaping the economic environment of the petroleum-containing countries they entered, they largely ignored the natural environment they would be affecting. 760:

The "South Zone" for Pemex includes the states of Chiapas, Tabasco, Campeche, Yucatán, Quintana Roo and the southern portions of Guerreo, Oaxaca and Veracruz with exploration beginning in 1863 with Father Manuel Gil y Sainz's San Fernando Mine near Tepetitan Town, Tabasco, Dr. Simon Sarlat's well in

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went differently. During Cárdenas's speech, he claimed that the resources in the subsoil belonged to the Mexican nation, and therefore would not be considered as part of the compensation to foreign businesses. The companies, however, assumed compensation should include the fuel that was estimated to

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This further fueled a massive land rush by the foreign oil companies. The two main companies Edward Doheny's Huasteca Petroleum, and Weetman Pearson's El Aguila were able to secure a large sum of land rights through ownership, and leasing. By 1922 Huasteca petroleum owned or leased 1,223,780 acres,

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Development of petroleum took place as Mexico's railway system was developed in the 1880s and 1890s, allowing petroleum to reach export markets; before that there was no internal market for Mexican petroleum and no way for petroleum to be easily exported. By 1901, commercial production of crude oil

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Some researchers claim that the degrading infrastructure of many drilling sites in Mexico made areas unfit for habitation. The habitats in question include those used by animals, vegetation, and the human population of the area. The contamination of the ecosystem after drilling occurs often causes

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The U.S. State Department assisted with the boycott in various ways. Purchases of Mexican silver were suspended, which represented an average amount of $ 30 million annually, although after 1938 sales were resumed in smaller quantities and lower prices. In the United States, government departments

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in petroleum output and led the world in oil exports. Oil production and exports from 1921 to 1925 were at historic high levels. In 1921, production was, in barrels of 42 gallons each, 193 million, with exports of 172 million. Production and exports declined each year through 1925, when production

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in 1933. The U.S. government required cooperation to guard its borders and coastlines and to secure the supply of raw materials, including oil. The Mexican government agreed to pay $ 40 million for claims originating from the Mexican Revolution, and the U.S. government opened a line of credit in

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granted the Mexican government the permanent and complete rights to all subsoil resources. This would cause conflicts between the Mexican government and foreign companies, and “lay basis for a twenty-one-year struggle” between Mexico and foreign oil companies. Foreign oil companies questioned if

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Petroleum was known in Mexico before the arrival of the Spaniards and used by the natives for incense and to repair canoes. In Mexico's colonial era (1521-1821), ranchers lost cattle to tar pits in the Gulf Coast Region, so it was considered more of a hazard than a valuable resource. Exploratory

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The expropriation of lands by the Mexican government started with the ratification of the Mexican constitution of 1917. By nationalizing the land, Mexico and the people would be better able to control working conditions, pay, and environmental impact. However, this expropriation of land further

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for metals like iron had devastating impacts such as loss of mountain landscapes, toxic waste disposal, and the demolition of entire ecosystems. Native populations viewed this search for oil with disdain as it affected their agricultural way of life by removing cattle fields to make room for

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The British government demanded immediate compensation for the Mexican Eagle Petroleum Company. However, the company had been founded as a Mexican company under Mexican law. Therefore, the British government couldn't intervene directly in the company's favor. Diplomatic relations between the

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of all oil resources and facilities in Mexico. The government assumed control of all property of nearly every oil company operating in Mexico, including machinery, equipment, buildings, refineries, gas stations, ships and pipelines. At the time, the country's oil industry was dominated by

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that occurred in the Gulf of Mexico in 2010, many incidents have occurred on the physical territory of Mexico. Rather than simply affecting marine life and bodies of water, petroleum and the materials used to harvest it can also have negative impacts on dry land. For example,

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Eduardo Hay reaffirmed that the Mexican government was willing and committed to pay compensation within the stipulated time period. As the Dutch government began to realize the Cárdenas government would not reverse the expropriation decree, the Anglo-Dutch company

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Beginning with the desire for gold and silver in the sixteenth century, both foreign and domestic powers have mined the landscape of Mexico for natural resources and precious goods with a primarily financial focus and not an environmental one. The original

667:: heavy Maya-22 (accounting for more than half of the total production); light, low-sulfur Isthmus-34 (28% of production); and extra-light Olmeca-39 (20% of production). At the beginning of 2002 Mexico had the second largest proven oil reserves in the 151:

had contracted British Weetman Pearson, to engineer several major projects in Mexico, such as the drainage of Mexico City, the dredging of Veracruz harbor, and the building of the southern Vera Cruz Tehuantepec Isthmus railroad line. Mexican President

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sent business manager Arthur Methöfer to defend the interests of their citizens. Methöfer refused to recognize the legality of the expropriation and demanded the immediate return of expropriated property or immediate payment as compensation. Mexican

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hit record highs exceeding $ 100/barrel for the first time ever. By July the price had reached $ 147.27 and based on demand projections, outlooks were optimistic. At this time a group met at the Mexican finance ministry and reached an agreement to

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wells were first drilled in Mexico in 1869 by U.S. entrepreneurs. In 1846, the first modern oil well in the world was drilled in the South Caucasus region of Russian Empire, on the Absheron Peninsula north-east of Baku (in settlement Bibi-Heybat).

96:; while its oil production has fallen in recent years, oil revenues still generate over 10% of Mexico's export earnings. High taxes on the revenues of Pemex provide about a third of all the tax revenues collected by the Mexican government. 3484: 3454: 3359: 695: m) of proven oil reserves left by 2007. Mexico stands ninth in the worldwide ranking of conventional oil reserves with only Venezuela higher in the Western Hemisphere (although Canada ranks higher if proven reserves of 3479: 475:

Between 1938 and 1971, Mexico's oil output expanded at an average annual rate of 6%. In 1957, Mexico became a petroleum net importer after domestic demands exceeded domestic production. However, production rose to 177

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In 1935, all companies in the business of oil production in Mexico were foreign companies. Labor practices in these companies poorly benefited the workers since the companies were able to block the creation of

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Acevedo, J.S., 1980, Giant Fields of the Southern Zone-Mexico, in Giant Oil and Gas Fields of the Decade: 1968-1978, AAPG Memoir 30, Halbouty, M.T., editor, Tulsa:American Association of Petroleum Geologists,

1653:, Annual Report for 1947, in Committee on Interstate and Foreign Commerce, "Fuel Investigation: Mexican Petroleum," 80th Congress, 2nd session, HR 2470, Washington D.C., Government Printing Office 1949, p. 8. 3299: 3349: 136:, under which the state gave land titles to private owners. The privatization of land allowed state to declare any land that was not privatized to be public land. In 1883, the Mexican Congress passed the 3259: 850:

Annual production has dropped or failed to increase each year since 2004. Furthermore, it has been reported the 2005-2006 daily oil production was down by approximately 500 thousand barrels per day (79

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was created and proposed a project of general contracts for each oil company. A strike was planned to push towards an agreement but the matter went to the court instead. On December 18, the

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gas had turned the previously vibrant area into a silent and dead expanse. The transition of the land from verdant to empty resulted in a negative opinion towards the petroleum industry in

3474: 435:. Nonetheless, owing primarily to the boycott, Mexico maintained economic and commercial relations with these countries. Gradually, commercial and diplomatic relations between Mexico and 3688: 3444: 3354: 3304: 3264: 559: m). López Portillo increased Mexican petroleum production and used the value of the reserves as collateral for negotiating large international loans, most of which went to Pemex. 176:, although "El Aguila" continued to have a majority of British investors. Mexico became an oil exporting nation in 1911, with the first shipment leaving the Gulf Coast port of Tampico. 3738: 3439: 3434: 3429: 3284: 3419: 110: 3424: 3339: 3314: 1375: 348:

in a public speech recognized the right of Mexico to expropriate the oil properties and agreed to accept compensation for the properties of the companies excluding underground oil.

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order to stabilize the Mexican currency. The State Department also resumed purchases of silver from Mexico and investments were made in Mexico's transportation infrastructure.

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Mexico. The True Facts About the Expropriation of the Oil Companies' Properties in Mexico: Government of Mexico. Mexico City: Talleres Gráficos de la Nación, 1940. Print.

3693: 372:), and specialized machinery. This plan was supported by several American companies which refused to sell certain products to Mexico such as drilling equipment, pumps, 1087:

One way to analyze the presence of oil companies in places such as Veracruz is to see how the natives responded to outside forces that changed their way of life. The

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was more interested in forming a strategic alliance with Mexico to create an anti-fascist front than in protecting private companies and had already proclaimed the

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10 GJ); recovery is complicated by challenging, low recovery rate reservoirs, but is made more attractive due to the presence of light and super-light oil.

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struck oil in San Diego de la Mar, a co-proprietorship, that had been divided up into 87 individual lots, due to the privatization of lands. In 1889, President

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Hall, Linda B. Oil, Banks, and Politics : The United States and Postrevolutionary Mexico, 1917-1924. Austin: University of Texas Press, 1995. Print. pg 35

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Hall, Linda B. Oil, Banks, and Politics : The United States and Postrevolutionary Mexico, 1917-1924. Austin: University of Texas Press, 1995. Print. pg 32

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was 116 million, with exports of 97 million. In 1926 production dropped below 100 million barrels, and in 1942, net exports dropped below 10 million barrels.

3753: 769:, include Tonala-El Burro (1928), El Plan (1929), Cinco Presidentes (1946), Magallanes (1957) and Ogarrio (1957). Fields producing from the Chiapas-Tabasco 206:'s emergence as a more attractive source of petroleum, output fell to just 20% of its 1921 level. Production began to recover with the 1932 discovery of the 3723: 3633: 3583: 3543: 639:

at prices ranging from $ 66.50 to $ 87 barrel for a total of $ 1.5 billion or 330 million barrels. Shortly afterward the price of oil collapsed during the

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is the largest oil field in Mexico and one of the largest in the world producing. As of Jan 2001, Mexico has approximately 10.42 billion barrels (1.657

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Mirbabayev, Miryusif F. (2017) Brief history of the first drilled oil well; and people involved - "Oil-Industry History" (USA), v.18, #1, pages 25–34.

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is Mexico's state-owned petroleum company and, for decades, was the sole supplier of all commercial gasoline (petrol/diesel) stations in the country.

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1883, and commercial production from the Capoacan and San Cristobal oil fields in 1905 and 1906 respectively. Fields discovered with associated

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In the 1930s, as a consequence of worldwide economic depression, the lack of new oil discoveries, increased taxation, political instability, and

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Memorias e historias compartidas: intercambios culturales, relaciones comerciales y diplomáticas entre México y los Países Bajos, siglos XVI-XX

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Memorias e historias compartidas: intercambios culturales, relaciones comerciales y diplomáticas entre México y los Países Bajos, siglos XVI-XX

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Cambridge: Cambridge University Press, 2006. Print. Studies in environment and history; Studies in environment and history. pg 86. Table 2.1

1303: 2652: 2910: 574:, and vastly improving its production capabilities. These investments led to an increase in petroleum output from 400 million barrels (64 2210:

Santiago, Myrna (Spring 1998). "Rejecting Progress in Paradise: Huastecs, the Environment, and the Oil Industry in Veracruz, Mexico".

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in favor of establishing continental solidarity against non-American and non-democratic influences, an allusion to the governments of

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at the time used for boosting octane ratings. Gradually, companies that sold parts and equipment gave in as Mexico opted to buy from

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Since the initial surge of oil drilling in 1889, several accidents have occurred throughout mainland Mexico. In 1908, a fire at the

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Cambridge: Cambridge University Press, 2006. Print. Studies in environment and history; Studies in environment and history. p. 65

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Cambridge: Cambridge University Press, 2006. Print. Studies in environment and history; Studies in environment and history. pg 83

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Cambridge: Cambridge University Press, 2006. Print. Studies in environment and history; Studies in environment and history. pg 82

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Cambridge: Cambridge University Press, 2006. Print. Studies in environment and history; Studies in environment and history. pg 51

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and by 2009 the average price of oil was less than $ 55. The $ 5.1 billion deal is sometimes called "the Agustínian hedge" after

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oil. The import tax for Mexican oil increased from 15 to 50 cents on the dollar while Venezuelan oil was only taxed at 25 cents.

1212: 306:(or "Pemex") was founded, with exclusive rights over exploration, extraction, refining, and commercialization of oil in Mexico. 3165: 2920: 2789: 1911: 1853: 1057:

can damage water access for local populations and produce harmful chemicals that are leaked into the surrounding environment.

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countries were soon broken, but not before Mexico paid a debt claimed by the British government for damages caused during the

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Brown, Jonathan C. (1987). "Domestic Politics and Foreign Investment: British Development of Mexican Petroleum, 1889-1911".

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Brown, Jonathan C. (1987). "Domestic Politics and Foreign Investment: British Development of Mexican Petroleum, 1889-1911".

723: m) in proven oil reserves. In November 2006, Pemex reported that Cantarell has produced 11.492 billion barrels (1.8271 2453: 2418: 2265:

Salas Landa, Mónica (April 2016). "Crude Residues: The Workings of Failing Infrastructure in Poza Rica, Veracruz, Mexico".

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of 166 kilometers to transport the oil produced. By 2011, production is expected to reach 800 thousand barrels per day (130

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began a boycott against Mexico. The companies tried to prevent Mexico from acquiring chemicals necessary to the process of

2882: 2767: 86: 2302: 2784: 2693: 2401: 1241: 1988: 3510: 3231: 2615: 2503: 2443: 1364: 1275: 1222: 1201: 380: 235:, president of Mexico from 1934 to 1940. In 1938, Cárdenas ordered the expropriation of all oil companies in Mexico. 3191: 2610: 2585: 2365: 257: 1214:

Estados Unidos, petróleo y geopolítica: las estrategias petroleras como un instrumento de reconfiguración política

3108: 2703: 2642: 284: 2852: 2580: 1304:"Entre la diplomacia y el humanitarismo. El diplomático A. Methöfer y su mirada holandesa al México cardenista" 2915: 2820: 2575: 2423: 1461: 562:

From 1977 to 1980, Pemex received $ 12.6 billion in international credit, representing 37% of Mexico's total

17: 860: m/d) on the previous year. Nevertheless, Mexico still produced approximately 2.98 million barrels (474 191:

decreed that foreign oil companies must register their titles and limited their concessions to fifty years.

3503: 3279: 3224: 3123: 3021: 2925: 2725: 2708: 2605: 1155: 1150: 682: 1649:, p. 418, chart 13 "Production, Exports, and Imports of Petroleum, 1921-1947", utilizing sources from the 2830: 2730: 2657: 2391: 2345: 2325: 1049: 2308: 172:

and El Aguila 1,890,286 acres of land respectively. Pearson subsequently sold his shares "El Aguila" to

3133: 2954: 2845: 2835: 2508: 2463: 733: m) of oil. Several oil fields have also been discovered in the Chicontepec Basin and neighboring 388: 357: 3038: 2757: 2740: 2662: 2595: 2132: 459: 223: 2316: 1925: 3648: 2940: 2935: 2630: 2625: 2620: 2569: 2560: 2438: 1382:(in Spanish). México: Departamento de Historia de la Universidad Iberoamericana. pp. 239–266. 1310:(in Spanish). México: Departamento de Historia de la Universidad Iberoamericana. pp. 267–286. 742: 640: 870: m) of oil per day (2010 est.) ranking it seventh in the world in terms of total production. 188: 3011: 2872: 2600: 2408: 420: 228: 2468: 1267: 1259: 451: 3076: 2981: 2887: 2877: 2735: 2715: 2413: 2338: 444: 62: 778: 685:

fell from 20 years in 2002 to 10 years in 2006, and Mexico had only 12.4 billion barrels (1.97

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contains Mexico's largest, certified hydrocarbon reserve, totaling more than 19,000,000,000

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announced that Mexico's proven hydrocarbon reserves had risen up to 11 billion barrels (1.7

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also encouraged Pearson to develop petroleum reserves, resulting in the highly successful

8: 3113: 3103: 2986: 2892: 2772: 2720: 2543: 2523: 296: 1617:, US Bureau of the Census, 1960, p.360. By 1933, the US was a net exporter of petroleum. 1048:

Although the most popular incident in the public's mind concerning oil accidents is the

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Banks, and Politics : The United States and Postrevolutionary Mexico, 1917-1924

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