Preliminary Results at June 30, 2020 · transportation, quality adjustment and management costs,...
Transcript of Preliminary Results at June 30, 2020 · transportation, quality adjustment and management costs,...
Sonda de Campeche
Preliminary Results at June 30, 2020
Forward-Looking Statement &
Cautionary Note
1
Variations
If no further specification is included, comparisons are made against the same realized period of the last year.
Rounding
Numbers may not total due to rounding.
Financial Information
Excluding budgetary and volumetric information, the financial information included in this report and the annexes hereto is based on unaudited consolidated financial statements prepared in accordance with International Financial Reporting Standards as issued by the
International Accounting Standards Board (“IFRS”), which PEMEX has adopted effective January 1, 2012. Information from prior periods has been retrospectively adjusted in certain accounts to make it comparable with the unaudited consolidated financial information
under IFRS. For more information regarding the transition to IFRS, see Note 23 to the consolidated financial statements included in Petróleos Mexicanos’ 2012 Form 20-F filed with the Securities and Exchange Commission (SEC) and its Annual Report filed with the
Comisión Nacional Bancaria y de Valores (CNBV). EBITDA is a non-IFRS measure. We show a reconciliation of EBITDA to net income in Table 33 of the annexes to PEMEX’s Results Report as of March 31, 2015. Budgetary information is based on standards from
Mexican governmental accounting; therefore, it does not include information from the subsidiary companies or affiliates of Petróleos Mexicanos. It is important to mention, that our current financing agreements do not include financial covenants or events of default that
would be triggered as a result of our having negative equity.
Methodology
We might change the methodology of the information disclosed in order to enhance its quality and usefulness, and/or to comply with international standards and best practices.
Foreign Exchange Conversions
Convenience translations into U.S. dollars of amounts in Mexican pesos have been made at the exchange rate at close for the corresponding period, unless otherwise noted. Due to market volatility, the difference between the average exchange rate, the exchange rate
at close and the spot exchange rate, or any other exchange rate used could be material. Such translations should not be construed as a representation that the Mexican peso amounts have been or could be converted into U.S. dollars at the foregoing or any other rate.
It is important to note that we maintain our consolidated financial statements and accounting records in pesos. As of June 30, 2020, the exchange rate of MXN 22.9715 = USD 1.00 is used.
Fiscal Regime
Beginning January 1, 2015, Petróleos Mexicanos’ fiscal regime is governed by the Ley de Ingresos sobre Hidrocarburos (Hydrocarbons Revenue Law). From January 1, 2006 and to December 31, 2014, PEP was subject to a fiscal regime governed by the Federal
Duties Law, while the tax regimes of the other Subsidiary Entities were governed by the Federal Revenue Law.
On April 18, 2016, a decree was published in the Official Gazette of the Federation that allows assignment operators to choose between two schemes to calculate the cap on permitted deductions applicable to the Profit-Sharing Duty: (i) the scheme established within
the Hydrocarbons Revenue Law, based on a percentage of the value of extracted hydrocarbons; or (ii) the scheme proposed by the SHCP, calculated upon established fixed fees, USD 6.1 for shallow water fields and USD 8.3 for onshore fields.
The Special Tax on Production and Services (IEPS) applicable to automotive gasoline and diesel is established in the Production and Services Special Tax Law “Ley del Impuesto Especial sobre Producción y Servicios”. As an intermediary between the Ministry of
Finance and Public Credit (SHCP) and the final consumer, PEMEX retains the amount of the IEPS and transfers it to the Mexican Government. In 2016, the SHCP published a decree trough which it modified the calculation of the IEPS, based on the past five months of
international reference price quotes for gasoline and diesel.
As of January 1 2016, and until December 31, 2017, the SHCP will establish monthly fixed maximum prices of gasoline and diesel based on the following: maximum prices will be referenced to prices in the U.S. Gulf Coast, plus a margin that includes retails, freight,
transportation, quality adjustment and management costs, plus the applicable IEPS to automotive fuel, plus other concepts (IEPS tax on fossil fuel, established quotas on the IEPS Law and value added tax).
PEMEX’s “producer price” is calculated in reference to that of an efficient refinery operating in the Gulf of Mexico. Until December 31, 2017, the Mexican Government is authorized to continue issuing pricing decrees to regulate the maximum prices for the retail sale of
gasoline and diesel fuel, taking into account transportation costs between regions, inflation and the volatility of international fuel prices, among other factors. Beginning in 2018, the prices of gasoline and diesel fuel will be freely determined by market conditions. However
the Federal Commission for Economic Competition, based on the existence of effective competitive conditions, has the authority to declare that prices of gasoline and diesel fuel are to be freely determined by market conditions before 2018.
Hydrocarbon Reserves
In accordance with the Hydrocarbons Law, published in the Official Gazette on August 11, 2014, the National Hydrocarbons Commission (CNH) will establish and will manage the National Hydrocarbons Information Center, comprised by a system to obtain, safeguard,
manage, use, analyze, keep updated and publish information and statistics related; which includes estimations, valuation studies and certifications. On August 13, 2015, the CNH published the Guidelines that rule the valuation and certification of Mexico’s reserves and
the related contingency resources.
As of January 1, 2010, the Securities and Exchange Commission (SEC) changed its rules to permit oil and gas companies, in their filings with the SEC, to disclose not only proved reserves, but also probable reserves and possible reserves. Nevertheless, any description
of probable or possible reserves included herein may not meet the recoverability thresholds established by the SEC in its definitions. Investors are urged to consider closely the disclosure in our Form 20-F and our Annual Report to the CNBV and SEC, available at
http://www.pemex.com/.
Forward-looking Statements
• This report contains forward-looking statements. We may also make written or oral forward-looking statements in our periodic reports to the CNBV and the SEC, in our annual reports, in our offering circulars and prospectuses, in press releases and other written
materials and in oral statements made by our officers, directors or employees to third parties. We may include forward-looking statements that address, among other things, our:
• exploration and production activities, including drilling;
• activities relating to import, export, refining, petrochemicals and transportation, storage and distribution of petroleum, natural gas and oil products;
• activities relating to our lines of business, including the generation of electricity;
• projected and targeted capital expenditures and other costs, commitments and revenues;
• liquidity and sources of funding, including our ability to continue operating as a going concern;
• strategic alliances with other companies; and
• the monetization of certain of our assets.
• Actual results could differ materially from those projected in such forward-looking statements as a result of various factors that may be beyond our control. These factors include, but are not limited to:
• changes in international crude oil and natural gas prices;
• effects on us from competition, including on our ability to hire and retain skilled personnel;
• limitations on our access to sources of financing on competitive terms;
• our ability to find, acquire or gain access to additional reserves and to develop the reserves that we obtain successfully;
• uncertainties inherent in making estimates of oil and gas reserves, including recently discovered oil and gas reserves;
• technical difficulties;
• significant developments in the global economy;
• significant economic or political developments in Mexico;
• developments affecting the energy sector; and
• changes in our legal regime or regulatory environment, including tax and environmental regulations.
Accordingly, you should not place undue reliance on these forward-looking statements. In any event, these statements speak only as of their dates, and we undertake no obligation to update or revise any of them, whether as a result of new information, future events or
otherwise. These risks and uncertainties are more fully detailed in our most recent Annual Report filed with the CNBV and available through the Mexican Stock Exchange (http://www.bmv.com.mx/) and our most recent Form 20-F filing filed with the SEC
(http://www.sec.gov/). These factors could cause actual results to differ materially from those contained in any forward-looking statement.
Campo Ayatsil
2Q20 Total Hydrocarbons Production
3
• Production of liquid
hydrocarbons with partners
increased as compared to
2Q19
• During May and June
2020, PEMEX shut in
crude oil production by
100 Mbd to comply with
Mexico's agreement with
OPEC+
-1.8% -2.4%-5.3% -2.9%
Liquid Hydrocarbons Production (including partners)1
2018-2020
(Mbd)
-1.8% -2.4%-5.3% -2.9%
1,899 1,869 1,8291,738 1,690 1,690 1,712 1,712 1,758 1,693
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20
Production
Variation-1.6% -2.1% -5.0%
-2.7% 0.0% +1.3% 0.0%2.7%
-3.7%
1. Considers crude oil and condensates production of fields, including partners. During 3Q19, the crude oil and condensates series was adjusted to include the
proportional part of Ek-Balam’s production that is assigned to the State. Thus, the series was adjusted since 1Q19.
PEMEX production in 2Q20 was stable
as compared to 2Q19
4
-1.8% -2.4%-5.3% -2.9%
Liquid hydrocarbons production (without partners)1,
2018-2020
(Mbd)
-1.8% -2.4%-5.3% -2.9%
1,893 1,860 1,8161,723 1,675 1,673 1,694 1,693 1,739 1,673
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20
Production
Variation-1.8% -2.3%
-5.1% -2.8% -0.1% +1.2% -0.07%• Despite Mexico's agreement
with OPEC+ and weather
conditions, PEMEX's
production (without partners)
remained the same as in
2Q2020
2.7% -3.8%
1. Considers crude oil and condensates production of fields, including partners. During 3Q19, the crude oil and condensates series was adjusted to include the
proportional part of Ek-Balam’s production that is assigned to the State. Thus, the series was adjusted since 1Q19.
Crude Oil Production 2018 – 20201
Thousand barrels per day
5
1,928
1,893
1,8581,879
1,8611,839 1,834
1,803 1,812
1,753
1,702 1,714
1,626
1,7071,694
1,678 1,666 1,676 1,680 1,6901,713
1,663
1,703 1,7131,730 1,736
1,7511,726
1,6571,635
1,200
1,300
1,400
1,500
1,600
1,700
1,800
1,900
2,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
2019 20202018
Lowest
record
Shut in production
(OPEP+ agreement)
1. During the 3Q19, the crude oil and condensates series was adjusted to include the proportional part of Ek-Balam’s production that is assigned to the State.
New fields production
6
Start Conclusion Wells in production
Actual
productio/1
(Mbd)
Wells that will soon start
production
(julio-diciembre)
Additional
production(
Mbd)
1. Xikin February 5 2019 January 16 2020 Xikin-22 y Xikin-24 1.6 Xikin-32 5.0
2. Cahua February 13 2019 Julio 4 2020 Cahua-2 3.2 Cahua-3 3.0
3. Octli February 13 2019 Julio 2 2020 Octli-2 0.4 Octli-3 5.5
4. Tlacame February 13 2019 March 4 2020 Tlacame-3 6.8 Tlacame-13 y Tlacame-9 14.0
5. Suuk February 13 2019 June 8 2020
6. Tetl February 13 2019 May 16 2020 Tetl-1001 4.4
7. Chejekbal February 13 2019 March 16 2020 Chejekbal-1 7.4 Pokché-2DL 10.0
8. Esah February 5 2019 In process
9. Koban February 13 2019 In process
10. Mulach February 13 2019 March 14 2020 Mulach-10 y Mulach-5 20.3 Mulach-9 y Mulach-4 12.4
11. Cheek February 13 2019 June 28 2020 Cheek-1 5.1 Cheek-45 7.0
12. Hok February 13 2019 January 17 2020 Hok-44 3.5 Hok-4 5.0
13. Yaxché February 13 2019 In process
14. Manik February 5 2019 In process Manik NK-4 4.1
15. Chocol January 1 2019 /2 Chocol-1
16. Cibix March 20 2019 /2 Cibix-1 y Cibix-12 2.2 Cibix-1001 y Cibix-14 4.0
17. Ixachi February 13 de 2019 /2 Ixachi-1, Ixachi-10, Ixachi-
1DL e Ixachi-2013.5
Ixachi-2, Ixachi-2001, Ixachi-1101,
Ixachi-11, Ixachi-34 e Ixachi 2418.8
18. Quesqui August 9 de 2019 /2 Quesqui-1 y Quesqui-1DL 14.2
19. Valeriana August 7 de 2019 /2 Valeriana-1 0.6 Valeriana-2DL 3.0
20. Terra Terra-101 3.2
Total 82.9 Total 95.3
Sh
all
ow
Wa
ters
infr
as
tru
ctu
re
On
sh
ore
Infr
as
tru
ctu
re
1. Production as of 22-July- 2020.
2. Date of first well
Mexico’s Crude Oil Production Jan-June 20201
Thousand barrels per day
7
1,725
2020
1,743
Private companies production
18 Mbd (1.0%)
99.0%
PEMEX
After almost 6 years from
the energy reform,
Petróleos Mexicanos
contributes the most to
Mexico’s crude oil
production
1. For PEMEX and partners as of June 2020. PEMEX (1,706 mbd) + Socios (19 mbd) and for private companies is the last number published by the
CNH in May 2020
Crude oil exports increased in 2Q20
8
600
800
1,000
1,200
1,400
1,600
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Mbd
2019
2020
Diferencia
(mbd)189 -382 -6 155 -143 119
During the second quarter of 2020, crude oil exports recorded an average of 1,118
Mbd, an additional 44 Mbd as compared to the second quarter of 2019
Total Crude Oil Exports
Thousand barrels per day (Mbd)
Mexican Crude Oil Mix Export PriceUSD/b
9
1
• As a result of the COVID-
19 pandemic, during 2Q20,
the average price of the
mexican export mix
recorded USD 24 per
barrel. This is USD 35.7
per barrel below the
average of 2Q19.
53.856.8 59.0
61.9 60.356.8 57.8
49.5
55.150.6 50.5
54.5
48.7
40.3
28.5
17.121.9
32.937.5
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2019 2020
Note: Weighted average price based on volume.
July 2020 figures as of July, 22nd.
Source: PEMEX, Estadísticas Petroleras (www.pemex.com)
Oil Products Reference PriceUSD per barrel
10
0
10
20
30
40
50
60
70
80
90
100
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul
Gasolines
Ultra Low SulphurDiesel
Jet Fuel
USD/b
2019 2020
Note:July 2020 figures as of July, 22nd.
Source: Platts
Crude oil process in 2Q20 increased by 40 Mbd as
compared to 2Q19
11
• Crude oil processing in
PEMEX's refineries increased
due to progress in the
rehabilitation of the National
Refining System
597
705640
505559
595657
557 542
631
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20
Crude Oil Processing, 2018-2020
Thousand barrels per day (Mdb)
Fuel Production Increased in 2Q20
12
• Due to the completion of
maintenance works at the
NRS plants, gasoline and
diesel production increased
192
243219
174 192211 218
193 187221
1T18 2T18 3T18 4T18 1T19 2T19 3T19 4T19 1T20 2T20
114
144120
90119
141 143117
103
141
1T18 2T18 3T18 4T18 1T19 2T19 3T19 4T19 1T20 2T20
Gasoline Production1
Thousand barrels per day (Mbd)
Diesel Production
Thousand barrels per day (Mbd)
1. Includes intermediate products and excludes naphtha production
Gasoline and Diesel Domestic Sales, 2020Annual percentage growth
131. July 2020 figures as of July 22nd.
Source: Pemex Industrial Transformation
-8% -8%
-13%
-38% -37%
-27%
Jan Feb Mar Apr May Jun
• As of May, 2020,
domestic sales
recorded a positive
trend that continued
throughout June
Results of the Strategy to Combat Fuel Theft, 2018-2020Mbd
14
56
8174
5 4 5 5 5 4 3 3 4 4 4 4 3 4 4 4 4 2 3 4 3 3 3 3 3 2 2 3 3 4 4 4 3
Ave
rag
e 2
01
8
No
v
De
c 0
1-2
0
Ave
rag
e 2
01
9
Ave
rag
e 2
02
0
Ja
n
Fe
b
Ma
r
Ap
r
Ma
y
Ju
n
Ju
l
01
-jul
02
-jul
03-jul
04
-jul
05
-jul
06
-jul
07
-jul
08
-jul
09
-jul
10
-jul
11
-jul
12
-jul
13
-jul
14
-jul
15
-jul
16
-jul
17
-jul
18
-jul
19
-jul
20
-jul
21
-jul
22
-jul
23-jul
24
-jul
Fuel theft has decreased by 96%
as compared to the average of
November 2018
2018
Losses due to fuel subtractionMXN million
15
36,214
3,630 1,420
3,225 1,015 256
2018 * 2019 * Jan-Jun 2020 *
Oil products LPG
Successful
strategy against
fuel subtraction
Estimated savings for
PEMEX in two years
amounted to**
MXN 72,557
million
1. Prices at storage facilities, does not include taxes (IEPS and IVA)
2. As compared to 2018
2
11
Net Profit (Loss)MXN million
17
-52,790
-562,251
-44,337
2Q 2019 1Q 2020 2T 2020
• For the second
quarter of 2020,
PEMEX improved
its results, as
compared to 2Q19
and 1Q20
• In 1Q20, net loss
was mainly
explained by the
profit exchange
loss due to the
peso depreciation
against the US
dollar
2Q20 Financial Highlights
18
2Q19 1Q20 2Q20
Sales 376 284 181
Cost of sales 282 243 153
Impairment (reverse) 4 (26) 18
Gross Income 90 67 10
Transportation and distribution
expenses37 37 40
Operating income (loss) 53 30 (30)
Financial cost, income due to
financial derivatives25 62 40
Foreign exchange profit (loss) 22 (469) 50
Taxes, duties and others 103 61 24
Net income (loss) (53) (562) (44)
1
2
3
4
5
MXN billion
6
7
8
9
10
Profit Margin (EBITDA / Sales) 1H20, O&G benchmark
19
9%
10%
10%
10%
11%
12%
17%
18%
20%
34%
40% • In the first half of the year, EBITDA as a proportion
of sales at PEMEX recorded 20%, placing the
company in third place among the selected
companies in the industry.
• In 1Q20, the company recorded a19% margin,
while for the second quarter, the margin recorded
23 per cent.
• The average result of both quarters, allowed the
company to counteract the negative impacts
expected by the decrease in world economic
activity, as a result of the COVID-19 pandemic,
Note: PEMEX’s EBITDA: Earnings before interest, taxes, depreciation and amortization, impairment, undeveloped wells and net periodic cost of
employee benefits net of pension and medical payments
Source: Bloomberg preliminary information and PEMEX financial statements (Equinor and Repsol reports observed information)
EBITDA and operating expenses peer comparison
20
50%59%
68%
80% 81% 84% 85% 83% 85% 82% 86%
10%
7%
12%
2% 2%4% 4% 7% 5% 8%
5%
40%34%
20% 18% 17%12% 11% 10% 10% 10% 9%
0%
25%
50%
75%
100%
Petrobras Ecopetrol Pemex Equinor Chevron Total Shell Eni BP Repsol Exxon
EBITDA
SG&A
Operationalexpenses
1/
2/
1. PEMEX’s EBITDA: Earnings before interest, taxes, depreciation and amortization, impairment, undeveloped wells and net periodic cost of employee benefits
net of pension and medical payments
2. Cost of sales, general and administrative expenses
Source: Bloomberg preliminary information and PEMEX financial statements (Equinor and Repsol reports observed information)
PEMEX’s efficiency: Operational costs below the average of O&G peers
EBITDA: Flow generation capacity
21
EBITDA Margin (%)
Petrobras 40
Ecopetrol 34
PEMEX 20
Equinor 18
Industria 17
Chevron 17
Total 12
Shell 11
ENI 10
BP 10
Repsol 10
Exxon 9M
exic
an
crid
e o
il P
rice
mix
US
D/b
l
16.1
14.615.5
14.5
11.6
4.1
48.2
30.9
44.2
61.458.7
31.5
0
10
20
30
40
50
60
70
0
2
4
6
8
10
12
14
16
18
1H 2015 1H 2016 1H 2017 1H 2018 1H 2019 1H 2020
EBITDAMMMUSDMMMP
42%
Precio de la Mezcla
Mexicana (USD/b)Margen EBITDAEBITDA
250
276.9
277.6
35%58% 41%
288.5
30%
221.5
93.9
20%
Note: PEMEX’s EBITDA: Earnings before interest, taxes, depreciation and amortization, impairment, undeveloped wells and net periodic cost of employee benefits
net of pension and medical payments
PEMEX’s lifting costs 2016-2019USD/b
22
7.8
10.9
13.7 14.1
2016 2017 2018 2019
+2.4%+26.0%
+40.1%
• Between 2016 and
2018, lifting costs
increased by 33%
on average, on a
yearly basis
• With the expense
discipline
implemented, the
increase in lifting
costs has been
limited to only
2.4% in 2019
Results of Austerity and Expense Discipline 2015-2020MXN million
23
2015 2016 2017 2018 20192020
(Jan-Jun)
Cleaning and sanitation materials and
others72 59 45 33 8 10
Mobile phones 13 11 8 7 2 0
Technical consulting 3,435 3,361 2,884 2,276 751 236
Research and Investigation 275 65 22 109 13 15
Services from third parties 1,205 284 629 1,243 761 658
Social Communication 119 165 211 244 12 17
Travel expenses 3,154 2,683 2,436 883 471 191
Conferences, conventions and events 26 12 42 11 0 0
TOTAL 8,300 6,640 6,277 4,805 2,019 1,128
8,300
6,640 6,2774,805
2,0191,128
Efficiency, austerity
and expense
discipline at PEMEX
Payments to Suppliers and Contractors January-JuneMXN million
24
149,613
158,815
2019 2020
+6.2%
Despite the severe
global crisis, a detailed
financial planning has
allowed the company
to mantain a steady
flow of payments, and
even increase them
during 1H20 vs 1H19
Note: Does not consider payments to government entities nor PEMEX’s affiliated companies.
Acknowledgement of liabilities and accounting provisions
25
According to IFRS:
• A liability must be acknowledged every time there is a legal or contractual
obligation.
• A provision must be recorded when resource output is likely and it is
possible to make a reliable estimate about it. Environmental and legal
provisions are recorded under this criteria.
Therefore, liabilities regarding suppliers are recorded according to the goods
and services received by PEMEX under the applicable regulations, since these
liabilities derive from a contractual obligation.
Total Financial Debt and Operational Performance,
2013-2020
26
64
7887
96103
106105 1052,522 2,429
2,267
2,1541,948
1,8231,684 1,706
1,224 1,155 1,065933
767612 592 589
2013 2014 2015 2016 2017 2018 2019 2020 E
Total Debt at Dec 31 (USD billion) Crude Oil Production (Mbd)
Crude Oil Processing (Mbd)
Note: 2020’s estimated figures are based on the zero net indebtedness internal goal for PEMEX, Total financial debt includes accrued interest.
CAPEX, 2013-2020MXN million
27
253,465
277,156
203,307183,021
113,02596,762
111,127
178,329
2013 2014 2015 2016 2017 2018 2019 2020 E*
Source: PEMEX’s 20-F Forms
1. For 2020 is estimated Budget for year-end.
1
Transfers from PEMEX to SHCP and support received,
Jan-June 2020MXN million
29
46,063
32,500
Federal governmentsupport
78,563 Total
Fiscal benefit
New refinery capital
injections
227,386
113,799
PEMEX's transfers tothe government
341,185 Total
Direct
(DUC &
others)
Indirect
(IEPS & IVA)
PEMEX has received this support
from the Federal Government
• PEMEX has
transferred MXN
262,622 million to the
Federal Government
net in 1H20
• For each peso that
the State invested in
PEMEX, it obtained
4.3 pesos in return
GDP O&G Contribution 2018-2020Percentage of contribution
30
• PEMEX's activity is recorded in the secondary sector of the economy. Particularly in the
"Oil and gas extraction activity".
• This activity has had a positive trend since 1Q19, contributing to national development.
• By 3Q19, oil and gas extraction ranked fourth in the level of contribution to the secondary
sector.
• By 4Q19, oil and gas extraction moved to third place, displacing the transport equipment
manufacturing industry.
12.2%
11.9% 11.9%
11.6%
11.0% 11.2%
11.4%
11.8%11.9%
10.5%
11.0%
11.5%
12.0%
12.5%
T1 2018 T2 2018 T3 2018 T4 2018 T1 2019 T2 2019 T3 2019 T4 2019 T1 20201Q 2018 2Q 2018 3Q 2018 4Q 2018 1Q 2019 2Q 2019 3Q 2019 4Q 2019 1Q 2020
Source: INEGI
O&G Industry Contribution to National GDP, 2017-2020
31
• This graph shows the evolution of the oil and gas extraction industry as part of Mexico's total GDP.
• As a result of increased oil production and a higher level of processing in our refineries, there is a growing
trend, with an average quarterly growth rate of 5.2% in the last five quarters, being the most relevant
activity for the sector.
• This is good news for our country's GDP, as both oil production and crude oil processing in our refineries
will increase in the second half of 2020.
1. MXN billions, 2013 constant figures
Source: INEGI
Crude oil production Forecast (PEMEX) & WTI prices by
rating agency
32
Rating Agency
Expected
annual crude oil
production
(Mbd)
∆% vs 2019
WTI expected
Price 2020
(USD / b)
PEMEX’s
production
1H20 (Mbd)
∆% vs 1H19
Average observed
WTI price* 1H20
(USD/b)
S&P 1,750 – 1,800 -0.028 $25
1,725 2.10% 38.91Moody’s1/ 1,667 -5.20%
$30(2,282 Mboed) (-1.0%)
HR Ratings 1,767 0.50% $38
Fitch 1,671 -5.00% $32
* Referencia del WTI Argus Houston.
Source: Press releases 2020 from rating agencies.
1. Moody's forecasts total hydrocarbon production, i.e. including gas.
Note: The conversion they use is 1 boe = 6,000 MMpc
PEMEX’s Debt BalanceMXN billion1
34
For the first time in 12 years,
Petróleos Mexicanos reduced its
debt balance
831
1,130
1,475
1,955 2,006 2,049 1,950
2013 2014 2015 2016 2017 2018 2019
MXN 99 billion
reduction
1. It does not include accrued intrests
Ten-year PEMEX’s bond yield
35
5.0
5.5
6.0
6.5
7.0
7.5
8.0
02/2
018
04/2
018
06/2
018
08/2
018
10/2
018
12/2
018
02/2
019
04/2
019
06/2
019
08/2
019
10/2
019
12/2
019
02/2
020
Incom
e (
%)
PEMEX 10 years
28/02/2020:
6.25%
Max:
20/11/18
7.65%
6.0
7.0
8.0
9.0
10.0
11.0
12.0
03/2
020
03/2
020
03/2
020
04/2
020
04/2
020
04/2
020
05/2
020
05/2
020
05/2
020
06/2
020
06/2
020
07/2
020
07/2
020
07/2
020
Incom
e(%
)
PEMEX 10 yers
Max:
27/04/2020
12.05%
24/07/2020:
7.94%
The maximum in the Covid-19 period is 12.05% compared to the maximum in the pre-
Covid-19 period of 7.65%
Pre-Covid-19: Jan 2018 – Feb 2020 Covid-19: Mar – Jul 2020
PEMEX’s crude oil hedge payments 2020
36
Month January February March April May June Total
Payment (USD million) 0.0 25.0 37.7 36.5 37.7 36.5 173.2
Date 06-mar 07-abr 07-may 05-jun 07-jul
• As of today, Petróleos Mexicanos has already received five payments
for oil hedging
• At June 2020, these payments amounted to USD 173.2 million
• The expected payment for the rest of the months covered is USD 192.7
million
Note: Total may not equal the exact sum of the figures due to rounding
Financial Strategy for 2H20
37
• Debt payments for the rest of the year are in line to be met as scheduled
• Just back on July 23rd , we paid around USD 1.1 billion in debt
amortizations and interests.
• PEMEX continues to work in a proactive financial planning strategy, in
order to anticipate volatile and uncertain periods that may occur.
• The goal for the second half of the year is to reduce the company´s
financial deficit, decreasing the temporary financing executed in the first
half of the year due to the difficult market environment.
• Our strategy aims to strengthen the company’s cash flow, while
decreasing financial needs.
Financial strategy for 2H20
38
• Negotiations with Export Credit Agencies (ECAs) have been ongoing and
will be finalized during the third and fourth quarters of the year.
• Moreover, PEMEX will implement financing strategies that do not
constitute public debt.
• The productive chain program will be strengthened to support our
suppliers and contractors for an orderly year end, with the support of the
development and commercial banks.
• Depending on market conditions, we may eventually consider refinancing
operations in the capital markets
2020 Financing Program and Maturity Profile for
2021 OnwardsUSD billion
39
11.6
6.0 5.5 6.3 8.5
4.0
8.7 9.8
4.3 3.6 4.7 3.9
0.0 0.0 0.0
30.2
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 →
1. Represents the pending amount to be covered by the 2020’s financing program, considering the refinancing operations performed in the first
half of the year. Does not considers revolving credit facilities and short-term credits, nor accrued interests.
Sonda de Campeche
The agreement with OPEC+ and weather conditions
affected production
Liquids Daily Production
Mbd
NotE: During the 3Q19, the crude oil and condensates series was adjusted to include the proportional part of Ek-Balam’s production that is assigned to the State. 41
Liquids' production remained
stable under unprecedented circumstances
Note: During the 3Q19, the crude oil and condensates series was adjusted to include the proportional part of Ek-Balam’s production that is assigned to the State. 42
63% 63% 63% 64% 65%
27% 28% 28% 27% 25%
8% 8% 7% 8% 7%1% 2% 2% 1% 3%
1,673 1,694 1,693 1,739 1,673
0
400
800
1,200
1,600
2Q19 3Q19 4Q19 1Q20 2Q20
Liquids Quarterly ProductionMbd
Heavy Light Extra-light Condensates
82%
18%
Crude Oil Production2Q20
Offshore Onshore
Liquids production stabilization is also explained by development
and early production of new fields, which contribute to
offset production decline
Hok-44
Tlacame-3
Mulach-10
Chejekbal-1 Mulach 5
Ixachi 10
Cibix 1001
Quesqui 1DL
Xikin 24
Manik 4 67
Cheek 1
Ixachi 20
Cibix 12Cahua 2
Octli 2
Ixachi 2
89
0
10
20
30
40
50
60
70
80
90
Mb
d
Xikin-22
Quesqui-1
Valeriana-1
Cibix-1
Chocol-1
Ixachi-1
Ixachi-1DL
Dic Ene FebNov
Quesqui-1
(ducto)
Mar Abr May Jun Jul
Deferred production of the new fields is due to:
• Delay in infrastructure construction
• Bad weather conditions
• Operational problems in well drilling
Early production from exploratory wells
Development wells 43
Natural gas production records a marginal decrease
44
1. Does not include nitrogen
2. Includes nitrogen
Note: During the 3Q19, the crude oil and condensates series was adjusted to include the proportional part of Ek-Balam’s production that is assigned to the State.
2
75% 74% 75% 75% 72%
25% 28% 25% 25% 28%
3,637 3,685 3,769 3,714 3,604
0
1,000
2,000
3,000
4,000
2Q19 3Q19 4Q19 1Q20 2Q20
Natural Gas Production1
MMcfd
Associated Non-Associated
53%
47%
Natural Gas Production2Q20
Offshore Onshore
261 310 396 459 459
94.5% 93.6%91.9% 90.6% 90.0%
0
200
400
600
2Q19 3Q19 4Q19 1Q20 2Q20
Natural Gas UseMMcfd
Gas Flaring (MMcfd)
Natural Gas Use /Total Gas Produced
451. Preliminary results
Asset WellGeological
EraLocation
T.A./E.T.
mts
Deep
mts
Hydrocarbon
type°API
3P Reserve
MMbpce
Qo (Mbd)
oil
Qg
(MMcfd)
gas
AEMS Paki-1 Tertiary Offshore 27 2,140 O&G 25 10 2,364 1.5
AETS Terra-101 Mesozoic Onshore 3 5,720 O&G 40 10 4,325 15.5
AETS Quesqui-1DEL Mesozoic Onshore 3 7,900Gas &
condensates42 400 3,252 11.6
AETS Ixachi-2001 Mesozoic Onshore 3 8,000Gas &
condensates41 200* 729* 4.7*
Paki-1
Terra-101
Golfo de México
Tampico
Frontera
Poza Rica
Veracruz
Coatzacoalcos Villahermosa
Campeche
Cd. Del Carmen
Mérida
Guatemala
Ixachi-2001
Quesqui-1DEL
111
Exploration activities in 2Q20 preliminarily
incorporated 620 Mmbpce of 3P reserves
Planta Coquizadora - Tula
The Crude Oil Process and Oil Products
1. Includes dry gas, gasoil, light cyclic oil, aeroflex, asphalts, coke, lubricants and paraffins. 47
•Crude oil processing and
petroleum products production
recorded significant growth as
a result of improved operating
performance at Madero and
Cadereyta refineries
•The variable refining margin
shows an important recovery
during 2Q20
331 313 272 268 311
264 344285 274
320
595 657
557 542
631
-
200
400
600
2Q19 3Q19 4Q19 1Q20 2Q20
Crude Oil ProcessingMbd
Heavy Crude
Light Crude
-0.991.61
-2.64
-12.51
9.91
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
2Q19 3Q19 4Q19 1Q20 2Q20
Variable Refining MarginUSD/b
196 202 181 173 217
159 163 136 126
183
141 143 118 103
141 8 7
7 6
7 28 33
29 26
9 104 121
110 114
116
636 668
580 546
673
-
250
500
750
2Q19 3Q19 4Q19 1Q20 2Q20
Production of Petroleum ProductsMbd
Other*
Jet Fuel
LPG
Diesel
Fuel oil
Automotivegasolines
1
Gas Processing and Production
48
2,336 2,458 2,427 2,380 2,328
417 430 455 446 443
2,753 2,889 2,881 2,826 2,771
-
700
1,400
2,100
2,800
2Q19 3Q19 4Q19 1Q20 2Q20
Wet Gas ProcessingMMcfd
Sweet Wet Gas
Sour Wet Gas
2,218
2,368
2,314
2,241 2,241
223 218 220 225
210
180
230
280
2,000
2,100
2,200
2,300
2,400
2Q19 3Q19 4Q19 1Q20 2Q20
MbdMMcfd
Dry Gas and Gas Liquids ProductionDry Gas fromPlants (MMcfd)
Natural GasLiquids (Mbd)
1
1. Includes fractioning fluents.
Petrochemicals Production
49
31 30 38 49 74
143 150 97 91
84
48 56
44 69 18
3 3
2 3
2
92 99
98 91
75
53
73
43 57
35
35
38
29
49
71
406
451
350
408
358
-
100
200
300
400
500
2Q19 3Q19 4Q19 1Q20 2Q20
Production of petrochemicalsThousand tons (Mt)
Other*
Carbon black
Sulfur
Propylene andDerivatives
Aromatics andDerivatives
Ethane Derivatives
Methane Derivatives
1
1. Includes Carbon dioxide, crude butadiene, polyethylene waxes, CPDI, petrochemicals, heptane, hexane, hydrogen, isopentanes, pyrolysis liquids, nitrogen,
oxygen and pentanes.
PEMEX’s Industrial Safety Performance
50
In all moderate and severe events, Petróleos Mexicanos
performs a root cause analysis to identify the causes and
defines corrective actions to prevent recurrence
0.35
0.27
0.19 0.21
0.15
0.0
0.1
0.2
0.3
0.4
0.5
0.6
2Q19 3Q19 4Q19 1Q20 2Q20
Frequency indexAccident with disabling injuries/ MMhh
15
20
25
7
5
-
5
10
15
20
25
30
2Q19 3Q19 4Q19 1Q20 2Q20
Severity IndexTotal number of days lost/ MMhh
Refinería Lázaro Cárdenas, Minatitlán, Ver.
Estación de Bombas Beristain, Pue.
53
Questions and Answers
Alberto Velázquez
Chief Financial Officer
Reinaldo Wences
Deputy Director of Evaluation and Regulatory
Compliance at Pemex Industrial
Transformation
Francisco Flamenco
Acting General Director at Pemex
Exploration and Production
Investor Relations
(+52 55) 9126-2940
www.pemex.com/en/investors Sonda de Campeche