Mexican President Enrique Peña Nieto Introduces Energy Reform Proposal

Mexican President Enrique Pena Nieto presented a sweeping energy reform proposal Monday, which offers changes to amendments in Articles 27 and 28 of the Mexican Constitution that would allow privately owned companies to take part in exploration and oil drilling alongside state owned oil company PEMEX.

Opposition parties were quick to respond to the proposal. Left wing party PRD said it would have to analyze the plan, but it rejected private participation in the oil sector on principal. Gustavo Madero of the conservative PAN, said that Peña Nieto's proposal only sought to fix existing problems, but did not look into future opportunities for growth.

The main components of the Energy Reform Proposal were presented during a special ceremony in the morning. Here's a rundown of its 10 essential points:

1) The proposal reintroduces, word-for-word, the original Article 27 of the Constitution, relating to the national ownership of gas and oil as strategic goods for the nation. This would allow for shared utility contracts celebrated by the Government and/or individuals for purposes of exploration and extraction. It also allows individuals to take contracts with the government to refine petrochemicals, or take part in the transportation and storage of oil.

2) Fix the revenue system so Pemex can become fully competitive.

3) Restructure Pemex and its subsidiaries into two divisions: exploration and production and industrial transformation.

4) Improve the conditions of transparency and accountability in Pemex.

5) Establish a national policy to promote purchases of domestic suppliers in the hydrocarbon sector.

6) Allow individuals and private companies to participate in power generation.

7) The State will maintain the National Electric System Control and public service of the transmission and distribution networks, ensuring access for all producers of electricity.

8) Strengthen the Federal Electricity Commission through greater operational and organizational flexibility, which will help reduce costs.

9) Strengthen the powers of planning and the stewardship of the Ministry of Energy and the Energy Regulatory Commission.

10) A green reform that favors sustainability, which will invest more in technology development and adoption of clean energy sources that are naturally environmentally friendly. Promote using cleaner energy such as solar, wind and gas.