Mexico is on a nationalistic campaign for energy independence and needs more fuel. To that end, its state-owned oil company Petroleos Mexicanos has struck a deal for full control of a Houston-area refinery it shares with Royal Dutch Shell Plc.
Pemex, as the Mexican explorer is known, made an unsolicited bid for Shell’s 50% stake in the facility in Deer Park, Texas, and agreed to pay $596 million, according to a statement Monday. The transaction will be fully financed by the Mexican government and is scheduled to close during the fourth quarter. Shell will retain control of an adjacent chemical plant.
Mexican President Andres Manuel Lopez Obrador, known as AMLO, needs to fulfill campaign promises to restore the country’s self-sufficiency in energy. He’s risen to power partly through his criticism of free-market economic policies that he says ransacked the country’s oil riches. AMLO has placed Pemex at the heart of Mexico’s energy revival, and has promised no gas price hikes for consumers in the meantime.