AMLO Halts Mexico's Energy Auctions, Including Fracking, for Three Years
Mexico's new president, Andrés Manuel López Obrador (AMLO), has suspended all energy auctions for three years, including the first shale auction set for February 2019. This move comes after AMLO's campaign promise to ban fracking, a controversial oil and gas extraction method, and follows pressure from social and local communities against it.
AMLO's decision to halt energy auctions is seen as a strategic shift towards private investors, rather than a definitive ban on fracking. The fate of companies that already hold fracking permits remains uncertain. Despite AMLO's declaration of a fracking ban, the Mexican parliament has not yet fully codified this into law. Environmental groups and legislators are working together to establish a formal legal framework to prohibit fracking nationwide.
Fracking has been a significant technique in Mexico for oil and energy extraction, with an estimated 60 billion barrels of oil equivalent in shale reserves. Pemex, the Mexican national energy company, began shale energy exploration in 2010 in the northern region of Chihuahua. However, the Mexican Congress has not seriously discussed or approved any anti-fracking legislation in recent years.
AMLO's suspension of energy auctions signals a potential shift in Mexico's energy policy. While the ban on fracking has been declared, a formal legal framework is still needed for an effective stop to fracking. The future of companies with existing fracking permits and the ongoing efforts to establish a legal ban will continue to shape Mexico's energy landscape.
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