MEXICO CITY -- For generations, one of the sweetest jobs any Mexican could aspire to has been a slot at the state oil giant, Petroleos Mexicanos. No other company in Latin America churns out so much revenue.
Salaries are high, and Pemex also offers fat pensions, a low retirement age and sometimes-modest – even barely existent – workloads.
“There are thousands of people paid by Pemex each month who don’t have a job to do,” said Duncan Wood, the director of the Mexico Institute at the Woodrow Wilson Center, a nonpartisan research center in Washington.
But the sclerotic company has seen crude oil production fall each of the past eight years, endangering its role as the ATM of the federal government. The company supplies roughly a third of the Mexican government’s operating revenues.
In an announcement full of political theater, President Enrique Pena Nieto submitted a proposal to Congress this week to open Mexico’s energy sector to foreign investment. That move would end a 75-year monopoly by Pemex on most oil exploration, production and distribution.
Protecting his flank from nationalist attacks, Pena Nieto declared that Pemex would remain a totally state-owned company.
But experts say Pemex and its 151,000 employees are in for some turbulent times. It faces reorganization, possible flight of some of its best engineers to world-class oil companies soon to enter Mexico and efforts to shine a light on some of its opaque internal practices.
“It’s going to have to overhaul itself. Some, it can do on its own, but some of it it’s going to have to be pushed,” said John D. Padilla, the managing director of IPD Latin America, an energy consulting service in the region.
Padilla called Pemex “extremely bloated” and said he thought it could get by with a third of the employees now on its payroll.
“Mexico needs Pemex, but it needs a different Pemex,” said Juan E. Pardinas, the director of the Mexican Institute for Competitiveness, a research center that supports open markets. “We need a Pemex which is more efficient, which is less corrupt, a Pemex that works more as an oil company than a government entity.”
The Pemex union, one of the most powerful in the hemisphere, was long a pillar of support for the Institutional Revolutionary Party, which ruled Mexico for most of the 20th century and is back in power under Pena Nieto.
“Pemex is owned by the union,” Pardinas said. “Mexico has to renationalize the oil industry from the union leaders.”
Despite its problems, Pemex is a source of pride to many Mexicans, who see the company as a symbol of national sovereignty and strength.
“Pemex is not for sale and will not be privatized,” Pena Nieto said in a televised message Monday night. “Pemex will grow stronger and modernize.”
He said the company would be reorganized into two divisions, one focused on exploration and production and the other on processing oil and gas into fuel and petrochemicals.
Among state-controlled oil companies, Pemex has the lowest rate of crude oil produced per worker. A study earlier this year by Mexico City’s Research Center for Development found that each Pemex worker produced an average of 24.5 barrels per day, lower than Petrobras workers in Brazil (28.9), Ecopetrol S.A. workers in Colombia (76.4) or Statoil workers in Norway (78.4).