Mexico’s Crown Jewel
While historically Mexican natives made use of oil in various forms foreigners knew of its commercial use coming from more advanced economies. Commercial quantities of oil were being extracted by British and American companies by 1917.
Petroleos Mexicanos (Mexican Petroleum) or Pemex came into being in 1938 when then Mexican President Lazaro Cardenas nationalized the burgeoning oil industry which was basically monopolized by foreign companies. There had been an ongoing strike by Mexican workers for better wages and social benefits from their foreign employers.
This event has been very fortunate for Mexico as the land and seas around it began to yield vast oil reserves. Pemex is one of the largest companies in the world today be any measure. Its total assets are in the $400 billion range. It is a state-owned company.
While being state-owned and having the right to explore oil and gas prospect in the oil rich country has its advantages it also has great disadvantages. The company has become something of a milking cow for successive governments. It has not been able to fund needed projects and repairs and upgrades. It could not be run as efficiently as a private company with political considerations hampering it. Despite being the fourth largest oil producer in the world it is in a lot of debt.
Revitalizing initiatives are underway now to bring in fresh cash to the company and for more oil explorations to take place. Whatever the outcome the company has already provided billions and billions in oil revenue for the country.