Mexico

Overview and role of the EITI

Mexico’s economy, the second largest in Latin America, has become increasingly oriented toward manufacturing. While the extractive sector still plays a central role, the oil and gas sector’s contribution to the national GDP has decreased over the past two decades to 3.5% in 2018, compared to 8% in 2000. Mexico is also a producer of gold, copper, silver and zinc, and the mining sector accounted for 2.4% of the GDP in 2018.

In 2013, Mexico passed a constitutional reform to allow private investment in its oil and gas sector for the first time in almost a century. One of the central aims of the reforms was to bring greater transparency to how the sector is managed, from awarding licenses and collecting revenues from companies to monitoring the use of those revenues. Since 2016, Mexico has conducted a series of bidding rounds to allocate oil and gas blocks.

Mexico is using the EITI platform to strengthen existing transparency mechanisms in the oil and gas sector, improve the accessibility of data for citizens, improve information on the socio-environmental impacts of extractive activities and analyse the role of extractive activities in the energy transition.

Innovations and policy reforms

• In July 2020, the government launched the Data México portal with information on the mining sector, such as economic contribution, exports and employment figures broken down by gender. The portal presents datasets and visualisations that are easy to use, customise and download. Mexico’s multi-stakeholder group is exploring the feasibility of linking information from various websites to EITI Mexico’s web portal.
• In 2021, a group of civil society organisations produced a report with support from GIZ which analyses the challenges in accessing information on the environmental and social impacts of mining projects and hydrocarbon contracts of 30 companies reporting to EITI Mexico. It describes which environmental payments still need to be made transparent, the status of all projects and compliance with environmental legislation. The report can provide input and recommendations to help Mexico prepare its implementation of the Escazú Agreement.

Mexico’s Constitution establishes that the nation has direct ownership of its natural resources, including hydrocarbons and minerals. The oil and gas sector is governed by the Hydrocarbons Law and the mining sector is governed by the Mining Law. The Federal Budget and Fiscal Responsibility Law and the Fiscal Coordination Law also provide for the fiscal regime governing the extractive sector.

The extractive sector is mainly regulated by the National Hydrocarbons Commission (CNH), which regulates, supervises and evaluates the exploration and extraction of hydrocarbons, the Ministry of Energy (SENER), which grants hydrocarbon contracts and selects the areas used for the development of extractive activities, and the the Ministry of Economy, which regulates mineral exploration and extractive activities.

The Executive branch of the Mexican government has the power to grant concessions for the exploitation of minerals, and contracts for the extraction of hydrocarbons. Hydrocarbon exploration and exploitation licenses are issued through an open tender process and are granted by the Energy Secretariat (SENER). Contracts are granted to private companies and to Mexico’s national oil company, PEMEX.

Mining licenses are issued first come first served basis and are granted by the Ministry of Economy. Since 2003, the Mexican government has operated GEOINFOMEX, a website with detailed information on mining concessions and licenses including the commodities, duration, geographical data and companies holding licenses.

Since 2013, the National Hydrocarbons Commission (CNH) has been hosting a portal on its website that discloses the full text of contracts and the procedures, practices and documentation of licensing and contract monitoring.

• Hydrocarbon contracts portal
• Mining projects

Mexico does not have a legal framework mandating the disclosure of beneficial owners. However, in 2019 the government announced its adherence to the Principles of Transparency Disclosure of Beneficial Ownership, a project led by the United Kingdom with the Open Government Partnership.

In 2021, Mexico became the second country to confirm its participation in the Opening Extractives Programme, a global programme that aims to improve the quality, accessibility and use of beneficial ownership data. In September 2021, EITI Mexico published its definition of beneficial ownership which will underpin beneficial ownership disclosures in its forthcoming EITI Report.

• Beneficial ownership roadmap

Provinces receive about 2.3% of the oil income through direct transfers from specific funds. Mexico’s 2018 EITI Report describes the payments and obligations from all oil contracts and revenue allocations, as well as subnational transfers from the Hydrocarbon Extraction Fund (FEXHI) of USD 191 million. The report also describes the amounts collected by the Mining Fund (Fondo para el Desarrollo Regional Sustentable de Estados y Municipios Mineros), of more than USD 216 million.

EITI Mexico is administered by the Multi-Stakeholder Group (MSG), which is hosted by the Ministry of Economy and chaired by José Jabalera, General Director of Mining Development.

Mexico’s Validation against the 2019 EITI Standard commenced in October 2021.