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Mexico Clarifies Oil-Sector Rule: Sener Says New Powers Do Not Authorize Expropriations

Mexico’s energy ministry says the temporary-occupation mechanism is not expropriation.

Overview

  • Sener issued a statement rejecting claims that the state can expropriate energy plants, stressing any intervention is temporary and does not transfer ownership.
  • The regulation published on October 3 authorizes Sener and the National Energy Commission to assume temporary control of hydrocarbon operations in exceptional circumstances defined as public-utility needs.
  • Triggers include war, natural disaster, grave public-order disruption, or threats to national, energy or economic security under Article 309.
  • Measures are capped at 36 months, require a documented technical and legal basis with identified assets and continuity plans, and must provide market-value compensation and proven damages under the Expropriation Law.
  • When a permittee’s noncompliance endangers supply, authorities may order a three-year operational intervention, while specialists warn of investor uncertainty and Reforma reports oversight shifting from the CRE to the Executive.