A case in point about the incompetence of state control. According to this story, during a period of record high oil prices, the Mexican national oil company is actually LOSING money:
Mexico’s Cantarell oil field — discovered in 1976 and one of the world’s largest — is drying up. Pemex reported a 2007 net loss of US$1.48 billion (euro98 billion) this week, as its revenues are drained to fund schools, hospitals and public works. Meanwhile, every other major oil company is reinvesting unprecedented profits in oil exploration.
Mexico could lose its standing as a major oil exporter in five years if it does not find more oil, experts say.
And yet the fact that the company is state owned is celebrated in Mexico!
The sentiment dates back to March 18, 1938, when President Lazaro Cardenas kicked out the American and European oil companies that refused to pay union wage demands while reaping Mexico’s oil profits.
Every year on that day, school children learn about the bold eviction of foreign companies, especially those from the United States, whose annexation of half of Mexico’s territory after the 1846 Mexican-American War still hurts.
Women offered their jewelry to help pay to establish the national oil company. Arriola says her grandparents gave their chickens and pigs, and she is hell bent on protecting the company 70 years later.
Put these bureaucrats in charge of a desert and in short order there would be a shortage of sand…
Posted: April 28th, 2008 under Americas, General, oil.
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