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AMEXHI

MEXICO - Energy & Mining

Andrés Brügmann

President, Mexican Association of Hydrocarbons (AMEXHI)

Bio

Andrés Brügmann is a chemical engineer from UNAM with an MBA from IPADE and postgraduate studies at Stanford and Wharton. With over 20 years of experience in the industry, he serves as Vice President of Hokchi Energy and is the President of AMEXHI. Previously, Brügmann held the position of general director at Fieldwood Energy Mexico, overseeing the operations of the Ichalkil and Pokoch fields. Before that, he served as director of QRI and spent over eight years working at Pemex.

"It is an honor to be the head of AMEXHI, since the benefits and the contributions of our members to Mexico are significant."
AMEXHI aims to raise greater awareness of the industry’s accomplishments and emphasize the role hydrocarbons can play in achieving energy sustainability and contributing to higher revenues for Mexico.
What is your vision as President of AMEXHI?

It is an honor to be the head of AMEXHI, since the benefits and the contributions of our members to Mexico are significant. Following the previous efforts of AMEXHI, my vision as president is focused on three main goals. First, continue strengthening the relationship and communication of the association with the authorities to improve the regulatory framework and increase the legal certainty for the industry, hence allowing companies to operate more effectively. This requires working with the government on the federal and state level as well as other organizations to promote alignment and adoption of best practices. Second, we want to communicate clearly the accomplishments and contributions of our members. Since we are a highly specialized industry, distanced from the end consumer, the benefits that our projects bring to society are sometimes not fully understood. For example, in the past six years, exploration and production contracts have provided tangible results for Mexico including investments over USD30 billion, discoveries of over 2 million barrels of oil equivalent, the creation of more than 64,000 high-paying jobs, technology transfer training to over 15,000 students, and social initiatives that have benefited over 120 communities. My third goal is for AMEXHI to contribute to energy sustainability by reducing emissions, increasing energy efficiency, and supporting the energy transition. We do that by complying with the strict regulation for venting, flaring and gas utilization that is applicable in Mexico and by promoting the adoption of technology for carbon capture and sequestration. Companies bring to Mexico best practices and expertise of new technologies that they have implemented abroad.

What is the greatest opportunity to strengthen the national energy network?

The biggest opportunity in Mexico is to develop the nation’s energy potential. More than 53% of the areas with prospective resources are currently unassigned. Of those areas, 55% have potential to produce natural gas, a key transition alternative, to provide reliable and affordable energy to all Mexicans. Additionally, there is a significant number of areas and fields that no operator is currently working on; these resources will be stranded unless private companies complement the government efforts to increase production. In terms of natural gas, we are one of the few countries in the world that imports over 80% of domestic consumption from a single source. This places Mexico at risk since any political or meteorological event could cause a severe disruption in the manufacturing sector and impact the growth of the economy. The good news is that Mexico has contractual and regulatory framework that has proven to be successful. Despite Covid the first bidding rounds have delivered tangible results under the current Administration. Continuing this path will enable Mexico to capture nearshoring opportunities and monetize stranded resources, the country urgently needs, in order to build infrastructure to increase its competitiveness.

What would you like to see from the election candidates next year in terms of energy plans?

Industry is a key driver to achieve energy sustainability. By 2030, there will be 138 million Mexicans demanding energy, mobility, healthcare, and education, among other services. The government will face a major challenge providing them, and the oil and gas industry is one of the main levers to increase fiscal revenue and foreign investment. The projects have a long-term investment cycle therefore we are just experiencing the first results of the contracts. Currently, private companies account for 15% of total investment and produce over 100,000bpd and 200mcf of natural gas. The average government take of the existing contracts is 74%, one of the highest in the world, making the Mexican government the number one beneficiary of the activity of private oil and gas companies. AMEXHI will actively engage with the candidates and their advisors to increase the understanding of key challenges and opportunities that the industry faces, as well as the contribution that private companies could if they can work alongside Pemex and create synergies.

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