Repsol also eyeing up the Mexican market

Spain’s biggest oil company, Repsol, is studying Mexico’s fuel market as it considers whether to open fuel stations in the country, people familiar with the plans said.

A Repsol press officer declined to comment, however a spokeswoman at Mexico’s energy regulatory commission said that commissioners met with Repsol in February.

If it proceeds, Repsol would be following in the footsteps of companies such as Exxon Mobil Corp., BP Plc, and Glencore Plc, that have recently announced plans to invest in Mexico’s fuel retail market, taking advantage of rules allowing firms other than state-owned Petroleos Mexicanos to import fuel since April 2016.

The Madrid-based firm, which has a refinery and network of more than 400 service stations in Peru, is only likely to be interested in markets where it can have a five percent share or more, one of the people said.

Mexico’s recent energy industry opening was designed to lure investment and bring competition to a market formerly controlled by Pemex. However, the gradual elimination of fuel subsidies this year has also sparked social unrest as prices at the pump increased by as much as 20 percent in some regions in January.

The slow pace of new regulations and infrastructure hurdles has meant that companies continue to rely on Pemex’s pipeline and terminals to transport and store fuel, as well as to supply it in many cases.

Repsol has had a rocky relationship with Pemex, which sold a stake of about eight percent in the Spanish firm in 2014, valued at $2.8 billion.

The sale followed a lengthy dispute between the companies’ boards of directors, with Pemex citing differences over corporate governance as one of the factors that led to the fallout, according to a statement at the time.