Foreign firms plan to bid on refinery project, Mexico’s president says

Mexico City — The four foreign consortia and firms that qualified to build the Dos Bocas refinery in southeastern Mexico have agreed to bid on the project and will submit proposals in about two weeks, President Andres Manuel Lopez Obrador said Monday.

“The bidding process for the new Dos Bocas refinery has started. As you know, the call for bids went out on March 18 and the four firms that qualified responded, it’s a process and they said they would participate,” Lopez Obrador said during his morning press conference.

The president, popularly known as AMLO, said the bidders were expected to submit “their proposals” before April 18.

The Dos Bocas refinery, located in the southeastern state of Tabasco, will cost about 160 billion pesos (some $8.26 billion) to construct, AMLO said.

After visiting the refinery in the port city of Ciudad Madero, the president said his administration’s goal was to upgrade Mexico’s six oil refineries, which are operating at only 30 percent of capacity.

“This will mean investment of about 25 billion pesos in the six refineries,” the founder and leader of the leftist National Regeneration Movement (Morena) said, noting that the Ciudad Madero refinery was offline all of last year and will need 3.5 billion pesos ($180 million) in investment to resume operating.

With the six existing refineries upgraded and the new one in Dos Bocas online, Mexico will be “self-sufficient, (no longer needing) to buy gasoline abroad and reducing costs,” AMLO said.

The consortia formed by US-based Bechtel and Italy’s Techint, and Australia’s WorleyParsons and US-based Jacobs, along with US-based KBR and France’s Technip were invited to bid to construct Dos Bocas, the government said Monday.

Lopez Obrador said that to fight corruption, one of his administration’s priorities, he would speak directly with executives of the winning bidder and with the leader of the country where it is based to ensure that the firm will fulfill the terms of the contract and “act responsibly.”

“Even with President Donald Trump,” the Mexican leader said in response to a question from a reporter.

Questions were raised last month about the financing of the Dos Bocas project.

In an interview with the Financial Times, Finance and Public Credit Secretary Arturo Herrera said the refinery’s groundbreaking was delayed so that more capital could be injected into state-owned oil giant Petroleos Mexicanos (Pemex), allowing the energy company to increase production.

Lopez Obrador, however, said during his March 12 press conference that Mexico had the resources needed to build the refinery, refuting his finance secretary’s statements to the FT.

“We have 50 billion pesos (about $2.6 billion) for the refinery. We do have a budget,” the president said.