The Business Year

Javier Vargas

MEXICO - Energy & Mining

Javier Vargas

CEO & Vice President, Petrogas

Bio

Javier Vargas is an expert in consulting and architecture, particularly in projects for the implementation of equipment for storage, loading, and unloading of hydrocarbons. He holds architecture studies at UTSA, Texas, and a master’s degree in senior management from IPADE Monterrey headquarters.

Focusing on market needs and trends, Petrogas also invests in social networks to promote its products and keeps up with new technologies in markets.

What are your views on the oil sector in Mexico?

The sector is being held up by political issues. In 2020, we experienced significant growth; however, clients decided to wait and see what would happen when it became clear that several companies had their permits removed. Sales are continuing, but not at the same rate as before.

Within the gas station segment in which you specialize, there seems to be a lot of interest in investing.

Yes, there is a lot of interest, but now everything has slowed down. If you build a station, it could potentially be up and running in six months, but nowadays it can take years. In addition, offices are closed because of the pandemic, exacerbating the situation.

What innovations do you want to bring to Mexico?

As there are many companies that import fuel, the gas station operator wants to be sure that what they are selling to them is exactly what they ordered. We have technologies that detect octane levels in gasoline. Moreover, we have portable meters that tell you the exact amount of liters that go from the pipeline into the gas tank itself. It also tells you the temperature and even the location. For example, if a Pemex pipe leaves with 20,000 liters, the meter detects where and how many liters have been unloaded at each site so there is no confusion. We brought this product out before the pandemic but were unable promote it. Now there is a great deal of interest in it.

What are your objectives for the rest of the year to sustain growth?

What we are looking for is to stock our warehouses and train our service team. Moreover, we are continuing to invest in social networks in order to increase sales. We try to maintain prices at reasonable levels and keep up with new technologies. We are always attentive to market demand.

What is your perspective of the gas station sector in Mexico?

Permits are already being awarded so that gas stations can sell natural gas and gasoline. This could be a great opportunity and will help us to reduce polluting emissions from vehicles and stations.

Could you tell us about the segment you have in hydrocarbon terminals?

It is essentially a consulting business. We advise fuel importers; we visit them and focus on safety points. We also offer recommendations to inexperienced companies. For example, recently there was an incident related to operations with inappropriate equipment. Inexpensive pumps were used for water. However, these can be flammable as they have a tendency to release sparks. The hydrocarbon terminal sector is growing in Mexico even though everything else is rather slow. We were told that efforts today are not focused on what to supply and what not to supply, but rather on what will be done when demand returns.

As you have experience in advising on such projects, what would be your advice to an international company interested in investing in terminals here in Mexico? What steps should you take to ensure a smooth investment?

The customer sometimes asks us for equipment that is not suitable, and we emphasize that we do not sell that type of product. We would not want to commit ourselves to an insecure facility because we are also taking care of both our reputation and our name. We are careful in this area, and often offer advice on what not to use. The customer sometimes questions our advice, and, therefore, must act at their own risk, especially in the electricity sector.

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