Mexico City (AFP) - Mexico's state oil giant Pemex Friday posted a massive $3 billion third quarter loss, citing lower export volumes, falling fuel prices and a negative foreign exchange amid a controversial push for energy reform.
The monopoly's sharp loss compared to a profit of $1.87 billion in the same period last year, according to a company filing with the Mexican stock exchange.
Pemex, which funds around 40 percent of the government coffers, reported $31.46 million in sales in the July to September period, a 0.1 percent increase from last year.
The company's net debt rose by 2.7 percent to $62.1 million.
In August, President Enrique Pena Nieto unveiled a controversial reform plan to open the oil sector to foreign investments in order to increase production and modernize the state-run company.
The leftist opposition accuses Pena Nieto of trying to privatize Pemex, 75 years after foreign firms were thrown out of the energy sector.
But the president rejects the accusation, saying his proposal calls for profit-sharing deals with private firms while the oil would remain Mexico's property.
The company's oil production has fallen in recent years, from 3.4 million barrels per day in 2004 to 2.5 million in the third quarter of 2013.
Raymundo Tenorio, director of business studies at Monterrey Technology university, said the situation at Pemex has been "nosediving" and that he expects losses for the full year to reach around $3 billion
Some 55.2 percent of the company's sales revenues, around $70 billion, were destined every year for taxes to the state, he said.
Tenorio said the reform proposed by Pena Nieto would not improve the company's fiscal burden, meaning that Pemex would remain "the safe deposit box of public finances."
The company must therefore open its doors to foreign investments, he said, otherwise "the losses will continue to increase."
Leftist leader Andres Manuel Lopez Obrador, who lost the presidential election to Pena Nieto last year, has led protests against the reform, calling the plan a betrayal to foreign oil companies and a "vile and shameful robbery."
But Pemex director Emilio Lozoya Austin told the Senate on Thursday that the company needs to transform in order to invest more, become more efficient and transparent.
If the company continues investing at the same rate of $24 billion per year, crude production would only increase to 2.8 million barrels per day in the next decade, he said.
To tap the company's full potential in the next 10 years, Pemex would have to invest $62 million per year to reach average production of four million barrels per day, Lozoya said.
"The goal of the proposed constitutional reform is not to change the hydrocarbon property system," he said."The goal is to give the country a legal framework to get the most out of the hydrocarbon wealth for its owners, for all Mexicans."