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Energy
Pemex Halts One-Fifth Of Oil Production Due To Bad Weather
October 29, 2007
Pemex said it temporarily shut down one-fifth of its daily oil production –or about 200,000 barrels per day (bpd)– in the Gulf of Mexico due to bad weather and halted repairs to an oil rig damaged in the recent accident that killed 21 people. The company said it expected to resume production from the wells as soon as the cold front passed. The halt in production helped send U.S. crude oil futures up as much as 1% to a record high of more than USD 93 per barrel in trading. Mexico, which normally produces about 3.1 million bpd, is one of the top three suppliers of oil to the U.S.
Halliburton Wins USD 698 Million Service Contract For Southern Region
October 31, 2007
Pemex Exploracion y Produccion (PEP) has awarded U.S. oil service provider Halliburton's local division a contract for drilling works and final well development in the southern region. The contract is worth USD 698 million. Works will be conducted on the Samaria, Iride, Cunduacan, Platanal, Oxiacaque, Jacinto, Chinchorro, Palangre, Jujo, Santuario, Pijije, Tupilco, Costero and Tiumut wells. Oil services provider Dowell Schlumberger's Mexican unit was the only other company that had acquired bidding rules for the project.
Pemex Awards USD 394 Million Pipeline Maintenance Contract To EMS
November 1, 2007
Pemex said it awarded a USD 394 million pipeline maintenance contract to Houston-based integrated pipeline services company EMS Group. Pemex said the contract involves maintenance of about 3,000 kilometers of oil and product pipelines in the southern states of Tabasco, Veracruz, Chiapas and Oaxaca over a 10-year period. EMS Group provides services to customers in the U.S., Mexico and Canada. Pemex has had a number of problems with its aging pipeline network, including a recent leak of 10,000 barrels of diesel fuel in the state of Veracruz.
Dowell Schlumberger Wins Contract For Marine Well Evaluation
October 29, 2007
Pemex Exploracion y Produccion (PEP) has awarded to the Mexican division of multinational oil services provider Dowell Schlumberger a contract to evaluate production wells in marine locations offshore Campeche City, in the state of the same name. The contract is worth USD 13.2 million. Works are designed to obtain pressure, temperature and production data characteristics plus identify geological formations of various fields and determine their permeability, borders and type of deposits, among other things, in order to quantify reserves and optimize marine output.
TMM Secures 56 Pemex Contracts In Six Years
October 31, 2007
Mexican multimodal transport and logistics company Grupo TMM was the company awarded the greatest number of contracts by Pemex Exploracion y Produccion (PEP) during the Fox Administration. Between 2001 and 2006, TMM's subsidiary Maritima Mexicana obtained 50 contracts, and TMM itself obtained another 6 contracts from Pemex. Maritima Mexicana's MXN-denominated contracts' value amounted to MXN 879.7 million and USD-denominated contracts' value amounted to USD 143 million. The six TMM contracts were valued at USD 39.9 million.
Burgos-Monterrey LPG Transport System Operations To Start In 4Q
October 30, 2007
Mexican natural gas and LPG transporter Gasoductos de Chihuahua will start operations of the Burgos-Monterrey LPG transport system in 4Q. Gasoductos de Chihuahua had completed 99% of works as of end-September 2007. The 30,000b/d-capacity system features a 12-inch, 180km pipeline from the Burgos gas-processing center (CPGB) to Monterrey, in the state of Nuevo Leon. The system also includes a 40,000b/d storage terminal. Pemex's gas and basic petrochemicals subsidiary (PGPB) and U.S. energy company El Paso created Gasoductos de Chihuahua in 1996.
Lower House Approves Biofuels Law
October 30, 2007
The lower house approved a biofuels bill that looks to promote domestic production of ethanol and biodiesel to help expand fuel supplies. The lower house said that the main objective of the legislation is to use ethanol and biodiesel as blending components. Mexico has only enough proven oil reserves to last 9.3 years at current production rates, which has encouraged lawmakers to try to foster the production of alternative fuels. Critics say corn ethanol and other biofuels have caused a hike in food prices.
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Mining
U.S. Judge Refuses To Dismiss Asarco Lawsuit Against Mexican Owners
November 2, 2007
A U.S. federal judge has refused to throw out a lawsuit filed by Asarco against its Mexican owners in a ruling that eventually could help the bankrupt U.S. mining and smelting company recover billions of dollars to help pay off environmental and asbestos-related claims. The lawsuit alleges Americas Mining, a subsidiary of Grupo Mexico (Gmex), "fraudulently" stripped Asarco of its lucrative holding in two Peruvian copper mines just as Asarco was teetering on the edge of bankruptcy. The decision by U.S. District Judge Andrew Hanen in Brownsville, Texas, clears the way for a trial next spring.
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Banking, Insurance & Finance
Banorte Eyes Second Texas Bank Acquisition
October 29, 2007
Mexican bank Banorte said it is looking to buy a second Texan bank in Houston. In November last year, Banorte closed the USD 259 million acquisition of Inter National Bank (INB), with branches in the key border cities of El Paso and McAllen, home to growing Hispanic populations. Banorte's CEO declined to give names. Banorte offers mortgages through INB to U.S. retirees so they can buy seaside homes in Baja California and other profitable and fast-growing resort areas in Mexico. Banorte also offers mortgages to Mexican migrants in the United States, to be paid off in USD, to buy houses for their families back home.
Micro Lender Independencia Sees MXN 3.26 Billion In IPO
November 1, 2007
Mexican microfinance lender Financiera Independencia plans to raise up to MXN 3.26 billion through an initial public offering on the local stock exchange. Independencia said it plans to list up to 20% of the company, or 136 million shares including an overallotment of 17.7 million shares, through primary and secondary offerings in Mexico and international markets. The shares have been priced at MXN 24 a share, which values the company at MXN 16.32 billion. GBM Grupo Bursatil Mexicano brokerage will act as the lead placement agent in Mexico, while Credit Suisse will handle the international issue.
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Business & Industry
Alfa Plans USD 570 Million Capital Expenditure In 2008
November 1, 2007
Mexican conglomerate Alfa said that it plans to make capital expenditures of USD 570 million in 2008. Alfa said that the investments will build on acquisitions and expansions carried out in 2007, which the company described as a "transition year." Alfa said the next year's planned capex includes USD 200 million for petrochemicals, USD 180 million for auto parts, USD 110 million for its food division and USD 80 million for telecommunications.
Corporacion Durango Confirms It Will Establish A New Facility In Monterrey
October 31, 2007
Mexican paper company Corporacion Durango confirmed it will establish a new facility in Monterrey, in the state of Nuevo Leon. Corporacion Durango said it will launch operations in the near term in a large corrugated cardboard plant in Monterrey at a cost of USD 15 million. The annual capacity of the new plant will be 100,000 tons of paper. Corporacion Durango said it expects to install three other new and similar plants in the years 2009, 2011, and 2013, with an expected investment of USD 15 million per plant.
Grupo Modelo, Carlsberg Sign Collaboration Agreements
October 29, 2007
Mexican brewer Grupo Modelo said it has signed collaboration agreements with Danish brewer Carlsberg to distribute Grupo Modelo's beers in Italy, Switzerland, Malaysia and Singapore. Grupo Modelo is the exclusive and sole importer of Carlsberg's beers in Mexico and will widen its distribution net through the agreements. Carlsberg will sell Grupo Modelo's products as Super Premium imported beers.
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Housing & Mortgaging
Banorte Gives U.S. Citizens Credits Worth USD 40 Million For Houses In Mexico
October 29, 2007
During the first nine months of the year, Mexican bank Banorte gave U.S. nationals mortgage loans amounting to USD 40 million to buy homes in Mexico through the Inter National Bank. According to Banorte's CEO, one of the most profitable businesses are binational mortgages awarded mostly to U.S. current or future retirees who wish to acquire a property in Mexico.
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Construction & Infrastructure
ICA To Expand In The Housing Sector
October 29, 2007
Mexican construction company ICA said that its strategy for the coming years will be to expand in the housing segment rather than specializing exclusively in the construction sector. The company, however, will continue servicing the said industry as it is ready to work on a possible new refinery to be built in either Tuxpan or Salina Cruz in the states of Veracruz and Oaxaca, respectively. According to executives from ICA, the new strategy would reduce ICA's revenues from construction to 60% in 2010 from the current 80%; of the remaining 40%, it would be split, with half being provided by infrastructure and the other half by housing.
ICA 3Q Profits Increase 27.4% To MXN 260 Million
October 30, 2007
Mexican construction company ICA increased consolidated net profits 27.4% to MXN 260 million in the third quarter compared to 3Q 2006. While revenues actually slipped 4.1% to MXN 5.10 billion, the company also brought costs down 8.6% to MXN 4.16 billion over the comparable period, allowing the firm a 21.3% boost in operating profits to MXN 444 million. As of end-September, the construction backlog was MXN 30.8 billion, equivalent to 24 months of work based on 3Q construction revenues.
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Retail
Grupo Gigante Announces The Acquisition Of Shares In PSMT Mexico
November 1, 2007
Mexican retailer Grupo Gigante announced that it had acquired shares representing 50% of the equity of PSMT Mexico. Grupo Gigante made the disclosure via a statement filed with the Mexican Stock Exchange. The seller is Pricesmart, Grupo Gigante's partner in PSMT. PSMT is the result of a recently dissolved partnership that owned real estate that has been sold.
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Transportation
DF's New Metrobus Corridor To Cost USD 93 Million
October 31, 2007
The total investment for the new mass transit corridor serving Mexico City (DF) will come to nearly USD 93.4 million. The line, which will run east-west for 17.2km along the Eje 4 Sur road, will have 35 stations and see the transport of some 16 million passengers a year. It will connect with Metrobus' existing north-south Insurgentes corridor, as well as with the DF's metro system on lines 1 through 4, 7 and 8. DF mayor Marcelo Ebrard plans to install 10 Metrobus lines by the end of his administration in 2012.
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Telecommunications & Technology
CFC To Launch Probes Of Telmex, America Movil
October 30, 2007
The Federal Competition Commission (CFC) will launch separate investigations into the dominance of fixed-line operator Telmex and its mobile affiliate America Movil. The head of the CFC, Eduardo Perez Motta, said the investigations into the market power of the two companies, both controlled by Mexican billionaire Carlos Slim, would start in "a matter of weeks." It would be the second time in six years that the CFC has launched an investigation of the market dominance of Telmex, which has 90% of all fixed lines in Mexico.
CFE To Lease Fiber Capacity For Triple Play Services
October 30, 2007
The Federal Electricity Commission (CFE) said it will begin selling telecommunications capacity on its fiber-optic network in November. The CFE said it is ready to offer service as a ''carrier of carriers,'' but won't be providing so-called last-mile connections or offering telephony, video or Internet service. The commission said it has 13,300 miles of fiber-optic cable installed along its transmission grid, and will make capacity available to telecommunications companies on nondiscriminatory terms.
Movistar Enters Fixed Line Telephony Market
October 29, 2007
Spain's telephony company Telefonica's mobile unit Movistar has entered the Mexican fixed line telephony market despite the government not yet allowing foreign investment in the sector to be 100%. Movistar plans to compete with Telmex and has begun offering its fixed line service "Movistar en casa" in seven cities, including Mexico City (DF).
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Farming & Agriculture
Mexican Avocados To Replace California's Production After Fires
October 29, 2007
Mexican and Chilean avocados will substitute for California's production of the fruit since it has been considerably diminished by the recent series of fires in the state's southern region. San Diego County's farming commissioner confirmed that the flames consumed between 20,000 to 25,000 avocado trees in the region, which provides for 95% of U.S. avocado production. According to people interviewed, the disaster led to a 500% hike in the fruit's price in some regions.
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Hospitality & Tourism
Tourist Direct Investment Reaches USD 3.1 Billion In Nine Months
October 30, 2007
The Tourism Minister said that national and foreign direct investment for tourism in Mexico reached USD 3.1 billion from January to September. The official said that Mexico's tourist sector expects sustained long-term investment and an orderly development while respecting ecological balance and urban regulations. The tourism sector aims at receiving investment of USD 20 billion during the current administration to end in 2012, which is USD 3.3 billion per year.
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Economy
Senate Approves MXN 2.569 Trillion Income Bill For 2008
October 30, 2007
The Senate approved the income portion of the 2008 budget, giving the government MXN 2.569 trillion to spend next year. The Senate voted 102-3 with one abstention in favor of the income bill, which was approved earlier in October by the lower house. The spending part of the budget only needs to be approved by the lower house of Congress. The income bill includes additional revenue from the fiscal reform passed by Congress in September, as well as from a higher estimate for the average price of Mexico's crude oil exports.
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Border & Migration
Illegal Immigrants To The U.S. To Be Prosecuted And Convicted
October 29, 2007
U.S. immigration authorities will not only deport illegal immigrants to their countries of origin but will also prosecute and convict them. In Laredo, Texas, U.S. authorities have put in place the "Streamline" program to imprison illegal immigrants. Sentences will vary from six months to indefinite time. Illegal immigrants will be subject to Title 8, Section 1325, of the U.S. Immigration Law Code.
Oklahoma Law 1804 Against Immigrants Enters Into Force
October 30, 2007
The Oklahoma Taxpayer and Citizen Protection Act of 2007, or Law 1804, entered into force on November 1 and establishes that transporting, housing, hiding, and hiring illegal immigrants is a felony and will be punished with as much as one year in prison and a USD 1,000 fine. Renting an apartment or a house to illegal immigrants is also a crime and state police will be able to check on any suspect's migratory status.
Mexico Becomes Example In Efficient Remittance Use
October 29, 2007
According to a high official from the International Fund for Farming Development (IFFD), Mexico has become an example to other countries in the creation of efficient programs to use and invest revenue from remittances. The IFFD's coordinator for the remittance-use area cited Mexico's "3 x 1" program by means of which the federal government, state governments and municipal governments give one dollar each for every dollar sent by a migrant earmarked for investment/development projects.
Milken: Mexico Human Capital Losses Per Year Amount To USD 100 Billion
October 31, 2007
According to international finance expert Michael Milken, Mexico's greatest immigration cost is in its human capital loss, which he estimates at USD 100 billion annually, over the past 20 years. On another note, Juan Ramon de la Fuente, Rector of the Autonomous University of Mexico (UNAM) said that the number of Mexicans leaving the country is greater than those dying at home. The academic stated that 475,000 Mexicans died in Mexico while 581,000 left the country during 2006.
Mexico, U.S., Canada Agree On Mutual Assistance In Public Health Emergency
November 1, 2007
The U.S. Department of Health and Human Services (HHS), the Public Health Agency of Canada, and Mexico's Health Ministry agreed to strengthen cross-border coordination and cooperation in the surveillance, prevention, and control of infectious diseases for the protection of the health, well-being, and quality of life of their peoples. The Memorandum of Understanding (MOU) commits the three countries to assisting one another during a public health emergency whenever possible.
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Politics
TEPJF Confirms PAN Victory In Baja California's Gubernatorial Elections
October 30, 2007
The Federal Judicial Electoral Court (TEPJF) confirmed the victory of the Alliance for Baja California's coalition in the recent gubernatorial elections in that state. According to the justices, the arguments set forth by the "Para que vivas Mejor" party coalition contesting the election's result were inoperative and did not reveal the alleged offenses which were founded on generic affirmations that did not prove any legal irregularity in the electoral process. The National Action Party's (PAN) candidate Guadalupe Osuna Millan is now the official winner of Baja California's gubernatorial election.
Supreme Court Admits Tamaulipas' Lawsuit Against Calderon
October 30, 2007
The Supreme Court (SCJN) admitted the state of Tamaulipas' Government and Congress lawsuit against President Calderon for the allegedly illicit sale of 277 million cubic meters of water to the United States. The State says that the water, which was contained at the international Amistad dam, was not part of the U.S. – Mexico Treaty for the Distribution of International Waters.
Mexico Votes Against U.S. Embargo On Cuba At The U.N. General Assembly
October 26, 2007
Mexico, along with 183 countries, voted against the U.S. embargo on Cuba at the United Nation's General Assembly. The 45-year-old embargo has caused losses amounting to USD 222 billion. The only four countries that supported the economic blockade were the U.S., Israel, Palau and the Marshall Islands. There was one abstention by Micronesia.
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Justice, Safety & Crime
Mexico Seizes 23.5 Tons Of Cocaine Worth USD 400 Million in Manzanillo
November 4, 2007
Mexican authorities said that they seized 23.5 tons of Colombian cocaine in the Pacific port of Manzanillo, in the state of Colima. More than 11 tons of cocaine were found first packed in containers inside the Hong Kong-flagged Esmeralda, which had arrived in Manzanillo from the Colombian Pacific port of Buenaventura. But authorities subsequently discovered an additional 10,650 bales of the drug concealed among panels of laminated flooring, which makes this the biggest drug seizure in Mexican history. The government said that the drugs belonged to Mexico's most wanted man, drug lord Joaquin "El Chapo" Guzman. U.S. Ambassador to Mexico Antonio Garza put the value of the haul at USD 400 million, nearly equal to the amount of aid U.S. President Bush wants to give Mexico next year to aid the country's battle against drug lords. However, the U.S. government said last month that the average price of the drug on U.S. streets had risen to USD 118.70 per gram in the first six months of the year; such price would give the seizure an implied street value of some USD 2.7 billion.
Army Seizes Seven Tons Of Marihuana In Northern Mexico
November 4, 2007
The Defense Ministry (Sedena) said that troops seized seven tons of marihuana at a camp in the northern state of Durango, but no arrests were made. Soldiers on patrol near the town of Coneto de Comonfort came across the camp and discovered an operation to process the illegal drug. The marihuana was in various stages of processing, with some of it being dried, while the rest had already been prepared and packed for shipping. Troops conducted a search of the camp and found an ATV, ammunition clips, 2,000 rounds of ammunition of various calibers and uniforms similar to those worn by police, as well as other equipment.
President Calderon, Undersecretary Negroponte Meet Over Merida Initiative
October 30, 2007
President Calderon and U.S. Undersecretary of State John Dimitri Negroponte met to review details on the "Merida Initiative." Negroponte also met with federal legislators and other government officials at an event at a hotel in Mexico City after U.S. Ambassador to Mexico, Tony Garza, summoned them.
GA: Drug Traffickers Send About USD 10 Billion To U.S. Each Year
October 30, 2007
According to the federal attorney general Eduardo Medina, about USD 10 billion in laundered Mexican drug money ends up in U.S. banks each year. Mora said Mexican banks receive about USD 1 billion from their U.S. counterparts each year, but return up to USD 16 billion, about USD 10 billion of which "goes unexplained . . . and could be attributed to the flow of drug trafficking money." Before ending up in the Mexican financial system, the money is laundered through cash purchases of real estate, cars, jewelry, furniture and other expensive items.
The Washington Post: 2,000 Firearms From The U.S. Enter Mexico Every Day
October 30, 2007
The Washington Post said that according to Mexican research, up to 2,000 firearms from the U.S. enter Mexico every day. The weapons that are said to have flooded Mexico are AK-47s, pistols, grenades, grenade launchers and high-caliber ammunitions. An official from the U.S. Bureau of Alcohol, Tobacco and Firearms (ATF) said that the arms power near the U.S. – Mexico border is equal to that faced by U.S. soldiers in Iraq and Afghanistan.
Thousands Protest Against Crime In Tijuana
October 29, 2007
More than 5,000 people marched to protest crime in the Mexican border city of Tijuana, in the state of Baja California, where a state police officer was slain. The massive demonstration was called by the Citizens Public Safety Council of the State (CCSPE), a civic organization that had asked those taking part to wear something white. The march went along the main streets of Tijuana and ended in front of city hall.
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Other
Floods Batter The State Of Tabasco; International Solidarity Revealed
November 4, 2007
Four days of steady rain in the Gulf Coast state of Tabasco has caused rivers to overflow their banks, leaving vast areas of the state capital, Villahermosa, underwater. Governor Andres Granier appealed to residents of the city's central district to leave their homes but they did not listen to him. The death toll in the widespread flooding has been rising, as rescuers have struggled to evacuate people from rooftops and bring supplies to those protecting their homes from would-be looters. Damaged homes are above half a million. In the neighboring state of Chiapas, four bridges and 180 miles (300 kilometers) of roads were washed out. People are fighting over food and water, and there is a lack of electricity and running water; in addition, criminals are taking advantage of the situation. At least ten countries and several international organizations have helped Tabasco. The U.S. has sent USD 300,000 to Mexico.
Newly Discovered Works By Mexican Artist
October 29, 2007
Some 140 drawings by the late Mexican folk artist Martin Ramirez, once destined for the trash, survived for more than two decades in a California garage and will be shown next year at the American Folk Art Museum. The discovery of the works by the self-taught draftsman, who spent almost three decades in mental institutions, was astounding given that only 300 of his drawings and collages were known to exist until now.
Mexican Bishops See Halloween As "Harmful" Holiday
October 29, 2007
Mexico's Roman Catholic Church slammed Halloween as "damaging and against the faith," as conservatives sought to return to the country's traditional Day of the Dead. The U.S.-style holiday has made broad inroads in Mexico, with monster costumes almost as widely sold as the marigold flowers traditionally used to decorate relatives' graves during November 1-2 Day of the Dead ceremonies, when families build altars and leave food, drink and flowers for the dearly departed. "Those who celebrate Halloween are worshipping a culture of death that is the product of a mix of pagan customs," the Archdiocese of Mexico published in an article on its Web site.
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