(Reuters, 1.Oct.2018) — Mexico’s state-run Pemex has launched a tender to buy 350,000 barrels of U.S. Light Louisiana Sweet (LLS) crude for October delivery, according to a document seen by Reuters on Monday, a deal that marks the first crude imports in over two decades.
Pemex, which plans to use the foreign crude to supplement its dwindling domestic fuel output, would mostly process the oil at its largest refinery, the 330,000-barrel-per-day Salina Cruz, the company’s chief executive said last week.
Since 2015, Pemex has been considering a crude swap with the United States so it can import lighter oil while exporting its flagship heavy Maya crude. The company finally opted for importing the U.S. light oil on the open market at least until the current administration finishes its term at the end of November.
“(The) Light Louisiana Sweet shall be obtained from conventional fields without being blended, processed chemically or being added with naphtha or condensates,” according to the document detailing the tender’s terms.
Pemex is requesting the cargo be delivered between Oct. 20-22 at its Pajaritos terminal in the Gulf coast state of Veracruz.
Payment will be made 45 days after delivery. Bids will be received until Oct. 3, and must be indexed to West Texas Intermediate crude prices, according to the document.
LLS is a very light crude grade with 38.5 API degrees of density and about 0.4 percent of sulfur content. Tests for choosing the crude to be purchased were completed several days ago, Pemex said.
Pemex’s fuel imports increased 17 percent in 2017 as Mexico’s refining network worked far below capacity. So far this year, fuel purchases have remained almost unchanged at 961,100 bpd as input of light grades to its domestic refineries has been limited. Independent retailers have started importing their own gasoline and diesel on top of that volume.
Apart from a limited oil exchange with the U.S. Strategic Petroleum Reserve in the late 1990s, Mexico has not recently swapped or otherwise imported U.S. crude.
Some U.S. crude exporters have this year sought new customers amid trade tensions between China and the United States affecting the bilateral oil trade.
U.S. crude exports have grown this year. In July, they averaged 2.139 million bpd versus 956,000 bpd in the same month last year, according to the Energy Information Administration.
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