Texans Look to Strengthen Cross-Border Energy Ties with Mexico

Business News Americas (BNamericas.com)       

"Mexico needs major investments in electricity - it is facing growing deficits in gas and dwindling oil reserves. Texan companies want to partner with the Mexican people to meet these vast energy needs," Perry said.

Mexico imports a third of the gas that it consumes and the petroleum reserve recovery rate stands at only 40%. Not having the technology and resources to begin deep water drilling in the Gulf of Mexico further limits its oil exploration possibilities.

Mexico's President Fox has said that the country needs to invest US$10bn a year in oil exploration to meet the 100%-reserve replacement target that is set for 2006, but the government is currently investing half that amount.

"Stronger energy ties, greater privatization of the Mexican energy sector, and an increase in the number of cross-border energy projects will benefit consumers and employers in both countries," Governor Perry said, adding that Texans "are making stronger energy connections to Mexico a top priority."

Perry has proposed the Trans Texas Corridor, which is a 4,000 mile network of roads and rail lines, oil and gas pipelines and electric transmission lines that will better connect Texas and Mexico, making for increased economic opportunities.

On June 22, Perry signed a memorandum of understanding (MOU) with the governors of the Mexican states of Coahuila, Nuevo León and Tamaulipas calling for a joint effort in development and economic opportunities.