Mexico’s ambitious plan to reduce its dependence on fuel imports through the construction of a new $16 billion Pemex refinery has hit another snag, according to internal data obtained by Reuters.
The Olmeca refinery, which President Andres Manuel Lopez Obrador has described as a “dream come true,” is only receiving 16,300 barrels per day (bpd) of crude oil this week, less than 5% of its total 340,000 bpd capacity.
The data, confirmed by two sources familiar with the operations, also shows that in August, the refinery is scheduled to receive 170,000 bpd – still only half of the feedstock needed to operate at full capacity.
This slow ramp-up raises fresh questions about the progress of the project, which has faced repeated delays and cost overruns. The refinery was initially projected to run at half capacity by July 2023 and reach full capacity in 2024, but these deadlines have not been met.
In fact, just earlier this month, Pemex backtracked again, saying the refinery would only process 177,000 bpd this year before reaching full capacity in 2025 – a significant shift from previous timelines.
The sluggish start means Mexico will continue to rely on refined fuel imports, mostly from the United States, rather than the self-sufficiency promised by the president. It will also need to continue exporting its heavy crude oil, rather than processing it domestically as originally envisioned.
During Pemex’s last earnings call in late April, officials claimed the refinery would start producing diesel this month and gasoline soon after. However, they did not disclose the actual crude oil processing rates or targets, which the internal data now reveals.
The performance of this flagship Pemex project is crucial for Lopez Obrador, who is seeking to boost the state oil company’s role and reduce Mexico’s energy dependence on foreign suppliers. The ongoing delays and setbacks call into question whether the refinery will be able to fulfill the president’s ambitious goals anytime soon.