What a mess
The weakness of the government of President Felipe Calderón Hinojosa became embarrassingly obvious when Petróleos Mexicanos (Pemex) failed to meet its self-imposed deadline of the end of July to get a deal with eijidatarios (peasants who own land communally) that would allow it to start work on a new oil refinery. This will be the country's first new refinery for over 20 years and will be the Calderón government's biggest public spending project.
What makes the problem so knotty is that there are two sets of eijidatarios in neighbouring states. The state governors (one from Calderón's Partido Acción Nacional, PAN) and the other from the Partido Revolucionario Institucional (PRI), which now controls the lower chamber of the federal congress, are competing for the project. Whichever choice Pemex makes will be seen by everyone in Mexico as political. Yet the project should have been apolitical. Pemex should have provided the government with a list of viable, potential sites and the government should have approved the list and then let Pemex make the final choice simply on commercial grounds.
The two competing states are Guanajuato (run by the PAN) and Hidalgo (controlled by the PRI). Pemex's chief executive, Jesus Reyes Heroles, said that neither the authorities in Hidalgo state nor Guanajuato state had bought the 700 hectares (1,730 acres) needed for the refinery.
The Hidalgo town of Tula had been selected in April as the site for the US$10bn project, but now that a 100-day period to acquire the land from the eijidatarios has expired Pemex says the facility could now also be built in the Guanajuato city of Salamanca, where there is an existing refinery.
Dealing with eijidatarios is notoriously difficult. The Mexican courts have only recently (5 November 2008) awarded an injunction to a group of eijidatarios in Altamira, Tamaulipas, who owned land acquired for the expansion of the port in 1981. The eijidatarios argued, successfully, that they had simply sold the right to the land, not the right to build on it. So the new owners would have to pay another fee. Currently 59% of Mexico's national territory is composed of eijidos. Although a legal reform in 1992 allowed eijidatarios to sell (and buy) land, only 1% of the eijido hectarage has changed hands since.
In 2002 President Vicente Fox's attempt to build a new international airport for Mexico City at Atenco was thwarted by the refusal of eijidatarios to allow the government to buy their land.
Whichever of the two states is first to show documentary proof “over the next few months" that it acquired sufficient land for the refinery will land the project, Reyes Heroles said. The Hidalgo authorities need 837 eijidatarios to agree to sell their land, while in Guanajuato there are two separate options involving fewer eijidatarios : 211 in one area and 154 in another.
Abelardo Escobar, the minister for Reforma Agraria said that the government had to be sure that none of the eijidatarios' heirs could challenge the transfer of property to Pemex Refinacion, which will manage the construction of the new refinery. Reyes Heroles, for his part, said it is essential at this time to have “legal certainty regarding ownership of the land," adding that if the process is not carried out in compliance with the law any communal landowner could file a legal challenge against the project. The refinery is scheduled to come on stream in 2015. Pemex also is expanding its facility in Salamanca, Guanajuato, a project that should be complete by the end of 2014.
- Output
Between them, the new refinery and the refitted Salamanca plant are expected to produce 300,000 bpd of petrol. Without the new refinery and the expansion, Mexico will still have to import 500,000 bpd of fuel.