Information on Mexican 2014 Energy Reform

= MEXICO 2013-2014 NATIONAL REFORMS UPDATES =

Reforma Energética por ProMéxico
Information on Mexican 2014 Energy Reform

The Energy Reform Issues by Ernesto Velarde Danache, Inc.
Herein below please find 10 most important issues of the Energy Reform. 1 - Sets the control and planning of public power system and opens the door to individuals to enable them to participate in the activities of the electricity industry.

2 - On the subject of Hydrocarbons, it opens the possibility of executing contracts with public and privatecompanies. Nevertheless, it must be stated in the assignments that the subsurface resources are owned byMexico.

3- The Mexican Petroleum Fund is created for the Stabilization and Development that shall administer and distribute the proceeds from the contracts that are executed regarding energy.

4 - The National Hydrocarbons Commission and the Energy Regulatory Commission will be the regulatory bodies.

5- A governmental control is maintained over the transmission and distribution of electricity.

6- The Federal Electricity Commission (CFE) and Petróleos Mexicanos (Pemex) will become "productivecompanies of the Government", a change that will be regulated thereafter with additional laws, with a maximum term of two years.

7 - The Ministry of Energy is responsible for granting to Pemex the exploration areas, including those that arealready operating, and Pemex must demonstrate "technical, financial and execution capabilities" necessary for the operation.

8 - Pemex has a period of ninety days once the Bill is in effect in order to submit the requests in the areas that it wants to reserve and the Ministry of Energy shall issue its decision within a maximum period of 180 days from the date that Pemex submits the corresponding request.

9 - In the case of Pemex, the board shall consist of five members of the Mexican Government, including theEnergy Ministry, who will preside the board, and five "independent directors."

10 - The Oil Union, led by Carlos Romero Deschamps, will no longer be a member of the board of directors of Pemex.