Mexico's Pemex prioritizes paying down overdue debts to big service providers
By Adriana Barrera
MEXICO CITY (Reuters) — Mexican national oil company Pemex partially resumed paying down what it owes to suppliers at the end of last year, prioritizing large oilfield service companies over upstart private producers, according to company data and four industry sources.
The world's most heavily-indebted oil company has not, however, publicly disclosed the balance of its debts to suppliers since last October, when it said it owed some $5.6 billion, not including other related liabilities, including litigation costs and taxes.
At the end last year's third quarter, Pemex said it owed suppliers $17.4 billion.
The delayed payments to Pemex's key partners are a longstanding problem that could disrupt operations if not resolved.
Pemex did not respond to requests for comment.
It is, however, expected to provide an update on the delinquent payments when it reports its fourth quarter results next week.
President Andres Manuel Lopez Obrador has sought to prop up Pemex, doling out more than $90 billion over the last five years through a mix of tax cuts and capital injections.
The payments to providers restarted after some of Pemex's major service contractors last December publicly criticized the state-run company for its failure to pay up, arguing it put them in a critical situation.
A letter from private oil companies was sent to Mexico's finance minister outlining similar gripes. While it was not made public, a copy was seen by Reuters.
Pemex soon began paying hundreds of millions of dollars in payments to major service providers SLB, Weatherford and Halliburton (NYSE:HAL), in what sources described as an effort to privilege its own dependant operations first.
SLB and Weatherford said in annual reports
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