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Mexico Faces Cartel Security Risks in Opening Energy Sector

Mexico Faces Cartel Security Risks in Opening Energy Sector

On one particular pipeline being built in Mexico’s desert, work stopped at 5 p.m. No exceptions.

“After 5:30, when the cartels start moving drugs, they have to leave the site. And the cartel made it very clear that if they saw them after 5:30, they would be butchered. So they enter into an ‘agreement,'” says Miriam Grunstein, a professor at the Universidad Autonoma de Nuevo Leon and attorney who advised the unnamed pipeline construction company that entered into the understanding.

“It’s very spooky, but that’s how it works,” she says.

Pick your euphemism, but oil and gas companies are certainly no strangers to working in “volatile,” “dynamic” or “uncertain” settings, whether they be in Angola, Colombia, Indonesia, Nigeria or Papua New Guinea, not to mention Iraq after the U.S. invasion. Now Mexico may soon join that list: Last year, his country faced with a potential credit downgrade and hungry for cash, President Enrique Pena Nieto announced Mexico would begin allowing foreign companies to drill for oil and gas alongside the state-owned company, Petroleos Mexicanos, or Pemex, which has controlled exploration and production since 1938.

Source: Mexico Faces Cartel Security Risks in Opening Energy Sector – US News