Exxon Mobil Corp announced it will bring its Mobil-brand gas stations to Mexico, pumping $300 million in the coming decade as it seeks to gain a foothold in the country’s retail fuel market.
Exxon expects to open its first service stations in Mexico later this year and will offer motorists its Synergy gasoline and diesel fuels, the U.S.-based oil company said in a statement on Wednesday.
The company did not specify how many service stations it would open in Mexico or where it would source the fuel for them. But local newspaper Reforma reported on Wednesday that Exxon company official Martin Proske said in an interview that supply options included importing fuel via train or boat or buying gasoline from state-owned Pemex.
The plan follows BP Plc’s announcement earlier this year that the British oil giant would open about 1,500 service stations in Mexico within five years.
BP told Reuters on Wednesday that its foray into Mexico is proving more promising than expected, and that it would likely increase its investment in everything from exploration to retail fuel sales.
Separately, Mexican media reported Royal Dutch Shell said it would also open its first gas station in the country this year, citing the firm’s downstream chief for Mexico, Andres Cavallari. Shell did not immediately reply to requests for comment.
Latin America’s No. 2 economy is home to about 11,400 gas stations and is the world’s fourth biggest gasoline market, Mexico’s energy minister has said.
For decades, Mexico’s fuel market was closed – by law – to any company but Pemex. But in 2013, reforms ended Pemex’s monopoly in everything from crude oil production to retail sales.
“Recent energy reforms present a unique opportunity to help meet the growing demand for reliable fuel supplies and quality service in Mexico,” Exxon’s Proske said in a company statement.
Fears had grown in Mexico that foreign investment might fall after U.S. President Donald Trump was elected last year, as he railed against companies that moved operations to Mexico.
U.S.-Mexico relations have also been strained by Trump’s threat to ditch the North American Free Trade Agreement and his promise to build a wall between the two countries.
But Exxon’s announcement was the latest good news for Mexico’s economy after General Electric Co last week praised the country as vital to its growth and Siemens later said that it was going to swap out U.S. imports for local supplies at its Mexican plants.
However, growing fuel theft has worried some in the energy sector. Mexican authorities have been struggling to contain criminal gangs siphoning off fuel that Pemex has said is costing it some 27,000 barrels per day in gasoline and diesel.
(Reporting by Veronica Gomez and Mitra Taj; editing by W Simon, Diane Craft and G Crosse)