Mexico’s state oil company Pemex stated on Monday that the processing plants at its Salamanca refinery in the central state of Guanajuato had been restarted.
The plants had resumed operation on Friday only hours after they were suspended due to an interruption in its steam supply.
The Salamanca refinery processes 220,000 barrels per day.
State-owned Mexican petroleum company Petróleos Mexicanos’ (Pemex) CEO Jose Antonio Anaya and Mexico’s finance minister Luis Videgaray will travel to New York this week to assure investors about the company’s financial health following a $4.2bn liquidity injection.
Juan Pablo Newman, the oil company’s chief financial officer, would also be accompanying the two on the roadshow.
Pemex has faced steep budget cuts in the last two years as crude oil prices have plunged globally and its output in 2015 has declined by over a third to an average of about 2.2m barrels per day (bpd) from 3.4 million bpd in 2004.
The new management installed in February 2016, including the CEO, is reviewing strategies to cut costs whilst continuing with future investments.
Previously, Moody’s downgraded Pemex by two notches to Baa3 on worsening credit metrics amid falling oil prices.
Ratings agency Moody’s downgraded Mexican state-owned company Petroleos Mexicanos’ (PEMEX) by two notches from Baa1 to Baa3 with a negative outlook. The downgrade was attributed to lower oil prices, poor financial results and the possibility of the Mexican government providing financial support to the firm, all of which has negatively impacted Pemex.
Previously, Moody’s had downgraded Pemex to Baa1 from A3 in November 2015 and in January 2016, put it on review for a second downgrade.
On the earnings front, Pemex reported 13 consecutive quarterly losses since 2012 and generated losses amounting to $32bn across the FY 2015 period. Debt on the company’s books at the end of December 2015 was c.$8bn.
Further, the company announced in February 2016 that it would trim its 2016 budget by $5.8bn (MXP 100bn) to mitigate losses caused by falling crude oil prices.
Separately, Moody’s also lowered its outlook on the sovereign debt of Mexico (rated A3) amid subdued economic growth in the country. Oil, a key source of revenue for the country, has fallen sharply on lower demand globally, leading to the Finance Ministry of Mexico announcing budget cuts.
Moody’s expects the Mexican government to step in should Pemex face further financial difficulty.