Policy & Regulation

21 Apr 2022

Mexican President Urges Energy, Lithium Firms to Talk to Government

21 Apr 2022  by   

FILE PHOTO: Mexico's President Andres Manuel Lopez Obrador delivers his quarterly report on his government's programs, at the National Palace in Mexico City, Mexico April 12, 2022. REUTERS/Henry Romero/File Photo

Mexican President Andres Manuel Lopez Obrador on Wednesday urged companies to consult their lawyers and talk to the government following decisions in support of his efforts to tighten state control of Mexico’s energy market and natural resources.

Speaking at a regular government news conference, Lopez Obrador pointed to votes in Congress this week to nationalize Mexico’s lithium resources and a ruling by the Supreme Court that upheld a contentious power bill promulgated last year.

The leftist president called on companies that have so-called self-supply energy permits, which he has sought to end, and those exploring lithium without proper permits, to talk.

Lopez Obrador proposed entering a transitional period and brokering agreements with companies in the sector so they can operate in accordance with Mexican legislation.

“I can’t turn a blind eye, I’m not going to do it, but I also don’t want criminal lawsuits to come first. The first thing to do is sit down for dialogue,” he said.

Mexico’s contentious moves to change the power and lithium sectors have been criticized by business groups and the United States, Mexico’s top trade partner.

In the electricity sector in particular, some investors and diplomats have warned of potential lawsuits due to a perceived violation of the regional trade deal, the United States-Mexico-Canada Agreement (USMCA).

Talks with companies should start in the next two weeks, Lopez Obrador said, underlining that government’s efforts will center on strengthening the role of the state power utility, Comision Federal de Electricidad (CFE).


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