UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of August, 2006
Commission File Number 0-99
PETROLEOS MEXICANOS
(Exact name of registrant as specified in its charter)
MEXICAN PETROLEUM
(Translation of registrant’s name into English)
United Mexican States
(Jurisdiction of incorporation or organization)
Avenida Marina Nacional No. 329
Colonia Huasteca
Mexico, D.F. 11311
Mexico
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1)
Yes No X
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7)
Yes No X
Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
Investor Relations (5255) 1944 9700 ri@dcf.pemex.com | ||
August 2, 2006
PEMEX unaudited financial results report
as of June 30, 2006
Financial highlights | PEMEX, Mexico’s oil and gas company and the ninth largest integrated oil company in the world1, headed by Luis Ramírez Corzo, announced its unaudited consolidated financial results as of June 30, 2006. | |
• Total sales increased 23%, as compared to the second quarter of 2005, reaching Ps. 281.6 billion (US$25.0 billion)2 | ||
• Income before taxes and duties increased 10%, as compared to the second quarter of 2005, to Ps. 157.0 billion (US$13.9 billion) | ||
• Net income was Ps. 11.6 billion (US$1.0 billion) in the second quarter of 2006 |
Table 1
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Financial results summary
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||
Total sales | 228,513 | 281,615 | 23 | % | 53,102 | 24,983 | 430,636 | 522,770 | 21 | % | 92,134 | 46,377 | ||||||||||||
Domestic sales(1) | 123,376 | 136,241 | 10 | % | 12,865 | 12,086 | 240,593 | 262,649 | 9 | % | 22,056 | 23,300 | ||||||||||||
Exports | 105,137 | 145,374 | 38 | % | 40,237 | 12,897 | 190,043 | 260,121 | 37 | % | 70,078 | 23,076 | ||||||||||||
Income before taxes and duties(1) | 142,878 | 156,979 | 10 | % | 14,101 | 13,926 | 267,289 | 307,047 | 15 | % | 39,758 | 27,239 | ||||||||||||
Taxes and duties | 140,912 | 145,352 | 3 | % | 4,440 | 12,895 | 264,587 | 287,676 | 9 | % | 23,089 | 25,521 | ||||||||||||
Net income (loss) | 1,969 | 11,627 | 490 | % | 9,658 | 1,031 | 7,275 | 19,370 | 166 | % | 12,095 | 1,718 | ||||||||||||
EBITDA(2) | 158,171 | 217,933 | 38 | % | 59,762 | 19,334 | 299,738 | 397,288 | 33 | % | 97,550 | 35,245 | ||||||||||||
EBITDA / Interest expense(3) | 9.8 | 20.6 | 11.1 | 17.2 |
* | Derived from unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
(1) | Includes the Special Tax on Production and Services (IEPS). |
(2) | Excludes IEPS. |
(3) | Excludes capitalized interest. |
Note: Numbers may not total due to rounding.
1 | Petroleum Intelligence WeeklyRanking, December 2005 |
2 | Amounts in US dollars are translated at the June 30, 2006 exchange rate of Ps.11.2723 per US dollar. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 1 /38 |
PEMEX | Investor Relations |
Operational highlights | • Total liquid hydrocarbons production totaled 3,778 Mbd, 3% less than the production in the second quarter of 2005: | |
• Crude oil production decreased 96 Mbd, or 3%, to 3,329 Mbd | ||
• Natural gas liquids production decreased by 1%, to 449 Mbd | ||
• Natural gas production rose 9%, to 5,281 million cubic feet per day (MMcfd) | ||
• Total hydrocarbons production measured in barrels of oil equivalent decreased 0.2%, from 4.50 million barrels of crude oil equivalent per day (MMboed) to 4.49 MMboed | ||
• Gas flaring represented 4.3% of total natural gas production | ||
• Crude oil exports averaged 1,813 Mbd, 0.4% higher than the volume registered during the second quarter of 2005 | ||
Operating items | ||
Exploration and production | ||
Crude oil production | During the second quarter of 2006, crude oil production averaged 3,329 Mbd, 3% less than the 3,425 Mbd average for the second quarter of 2005. Heavy crude oil production decreased by 6%, which was partially offset by increases in light and extra-light crude oil production of 3% and 25%, respectively. | |
The decrease in heavy crude oil production was due primarily to planned shut-ins of wells in Cantarell as a result of the increasing gas-oil contact. | ||
The increases in light and extra-light crude oil productions were due to the progress in the completion and workover of wells, as well as the installation of additional infrastructure in the Litoral de Tabasco and Abkatún-Pol-Chuc areas. |
Table 2
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Production of liquid hydrocarbons
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(Mbd) | (Mbd) | |||||||||||||||||||||
Liquid hydrocarbons | 3,880 | 3,778 | -3 | % | (102 | ) | 3,817 | 3,781 | -1 | % | (36 | ) | ||||||||||
Crude oil | 3,425 | 3,329 | -3 | % | (96 | ) | 3,371 | 3,337 | -1 | % | (34 | ) | ||||||||||
Heavy | 2,481 | 2,330 | -6 | % | (152 | ) | 2,446 | 2,353 | -4 | % | (93 | ) | ||||||||||
Light | 808 | 830 | 3 | % | 22 | 796 | 815 | 2 | % | 19 | ||||||||||||
Extra-light | 136 | 169 | 25 | % | 34 | 129 | 169 | 31 | % | 40 | ||||||||||||
Natural gas liquids(1) | 455 | 449 | -1 | % | (6 | ) | 446 | 444 | -1 | % | (2 | ) |
(1) | Includes condensates. |
Note: Numbers may not total due to rounding.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 2/38 |
PEMEX | Investor Relations |
Natural gas production | In the second quarter of 2006, natural gas production increased 9%, as compared to the second quarter of 2005. Non-associated gas production increased 19%, while associated gas production increased 2%.
The increase in non-associated natural gas production was mainly due to the addition of new development wells and infrastructure works in Burgos and Veracruz basins. In March 2006, production of the Lankahuasa and Arquimia fields commenced. The growth in associated natural gas production was primarily a result of the increase in lighter crude oil production. | |
Gas flaring | In the second quarter of 2006, gas flaring represented 4.3% of total natural gas production. The increase with respect to the second quarter of 2005 was due to maintenance works during June in Akal-J, in the Cantarell complex. |
Table 3
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Production of natural gas and gas flaring
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||||
(MMcfd) | (MMcfd) | |||||||||||||||||||||||
Total | 4,861 | 5,281 | 9 | % | 421 | 4,751 | 5,188 | 9 | % | 437 | ||||||||||||||
Associated | 2,999 | 3,072 | 2 | % | 72 | 2,950 | 3,048 | 3 | % | 99 | ||||||||||||||
Non-associated | 1,862 | 2,210 | 19 | % | 348 | 1,801 | 2,140 | 19 | % | 339 | ||||||||||||||
Natural gas flaring | 166 | 228 | 37 | % | 61 | 148 | 195 | 32 | % | 47 | ||||||||||||||
Gas flaring / total production | 3.4 | % | 4.3 | % | 3.1 | % | 3.8 | % |
Note: Numbers may not total due to rounding.
Wells | During the second quarter of 2006, the number of new wells drilled totaled 177, 44 less as compared to the second quarter of 2005. Exploration wells drilled totaled 17, 3 less as compared to the second quarter of 2005, due to a reduction in activities at the Veracruz and Campeche Oriente projects. Development wells drilled totaled 160, 41 less as a result of reduced activity at the Poza Rica, Veracruz, Cinco Presidentes, Bellota-Jujo, Macuspana and Cantarell projects, as well as to an increase in drilling and completion times at the Samaria-Luna and Litoral de Tabasco projects. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 3/38 |
PEMEX | Investor Relations |
Table 4
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Drilling activity and inventory of wells
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(Number of wells) | (Number of wells) | |||||||||||||||||||||
Wells drilled | 221 | 177 | -20 | % | (44 | ) | 397 | 347 | -13 | % | (50 | ) | ||||||||||
Development | 201 | 160 | -20 | % | (41 | ) | 356 | 314 | -12 | % | (42 | ) | ||||||||||
Exploration | 20 | 17 | -15 | % | (3 | ) | 41 | 33 | -20 | % | (8 | ) | ||||||||||
Total operating wells(1) | 5,797 | 6,137 | 6 | % | 340 | |||||||||||||||||
Injection | 284 | 257 | -10 | % | (27 | ) | ||||||||||||||||
Production | 5,513 | 5,880 | 7 | % | 367 | |||||||||||||||||
Crude | 3,085 | 3,144 | 2 | % | 59 | |||||||||||||||||
Non-associated gas | 2,428 | 2,736 | 13 | % | 308 |
(1) | As of June 30, 2006. |
Note: Numbers may not total due to rounding.
Seismic studies | During the second quarter of 2006, the area covered by new 2D seismic studies decreased as compared to the same quarter of 2005. This reduction was mainly due to decreased activity at the Burgos and Simojovel projects. The area covered by new 3D seismic exploration studies was 358 km2, mainly due to less activity at the Burgos, Área Perdido, Veracruz and Cuichapa projects.
The decrease in 2D and 3D seismic information studies is a result of the transition of several projects to the interpretation and analysis phases. |
Table 5
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Seismic studies
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
Seismic | ||||||||||||||||||||||
2D (Km.) | 1,371 | 305 | -78 | % | (1,066 | ) | 2,708 | 670 | -75 | % | (2,038 | ) | ||||||||||
3D (Km2) | 2,597 | 358 | -86 | % | (2,239 | ) | 5,735 | 1,080 | -81 | % | (4,655 | ) |
Note: Numbers may not total due to rounding.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 4/38 |
PEMEX | Investor Relations |
Discoveries | Our main discoveries in the second quarter of 2006 were: |
Table 6
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Main discoveries
Project | Successful wells in 2Q06 | Geologic age | Initial | Type | ||||
Burgos | Rusco-1 | Oligocene | 4.0 MMcfd | Non-associated natural gas | ||||
Fogonero-1 | Eocene | 0.5 MMcfd | Non-associated natural gas | |||||
Comalcalco | Cobra-1 | Cretaceous | 1.6 Mbd | Light crude oil | ||||
Veracruz | Mocarroca-1 | Eocene | 1.1 Mbd | Heavy crude oil | ||||
Campeche Poniente | Onel-1 | Jurassic | 3.7 Mbd | Light crude oil | ||||
Crudo Ligero | Yaxche-101 | Pliocene | 2.1 Mbd | Light crude oil | ||||
Noxal-1 | Pliocene | 9.5 MMcfd | Non-associated natural gas |
Noxal-1 | The well Noxal-1 is located 102 km from the Coatzacoalcos port in Veracruz. To date, it is the well with the greatest water depth drilled in Mexico, 935 meters, and is part of a group of locations within the exploratory project Gulf of Mexico B.
The objective of the well is to evaluate the hydrocarbons potential in Miocene and Pliocene sands. The well drilled reached 3,514 meters below the sea bed, and the penetrated geological column is constituted by sediments that range from the Lower Miocene to the Recent age. The production test, in rocks from the Lower Pliocene, provided an initial production of 9.5 MMcfd.
The exploratory opportunities in the neighboring geological structures to Noxal-1 suggest the presence of hydrocarbons, and have allowed the identification of eight megastructures with significant possibilities of containing hydrocarbons. Additional exploratory drillings in the area will allow us to validate its potential and to establish future development plans. | |
A.J. Bermúdez | In terms of crude oil production, the A. J. Bermúdez (AJB) Complex is the largest of the Southern Region and the fourth largest in Mexico. Its total reserves are the third largest in the country. It is part of the Integral Production Project Samaria-Luna and is located 20 kilometers northwest from Villahermosa, Tabasco. The oil it produces is light crude oil, with a density of 20 to 30 degrees API.
The main characteristics of the AJB are the following:
• is conformed by the Cunduacán, Oxiacaque, Samaria, Iride and Platanal fields;
• covers a total area of 163 square kilometers; and
• has 387 wells, 109 of which are currently production wells. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 5/38 |
PEMEX | Investor Relations |
The discovering well was the Samaria-2 drilled in 1960 and in 1973 its potential was confirmed with the exploratory well Samaria-101, which had an initial production of 5.2 Mbd of crude oil and 6.9 MMcfd of natural gas. The Iride and Cunduacán fields were discovered in 1974 and the Oxiacaque field in 1977.
In 1979, the AJB complex reached a crude oil production of 655.4 Mbd and since 1977, PEMEX has been implementing secondary recovery mechanisms which have been improved over time.
In 2002, the Integral Project A. J. Bermúdez, which includes exploratory activities, was authorized under the PIDIREGAS investment mechanism.
The main activities executed during the last four years are:
• acquisition of 485 km2 of 3D seismic,
• completion of 44 development wells,
• 113 workovers to exploratory wells, and
• accumulated production between 2002-2005 of 307 million barrels of crude oil equivalent.
As of January 1, 2006, proved remaining reserves of the AJB Complex totaled 1,378.3 million barrels (MMb) of crude oil and 2,938.7 billion cubic feet (MMMcf) of natural gas. Probable remaining reserves reached 139.1 MMb of crude oil and 258.9 MMMcf of natural gas.
In 2005, average production of crude oil and natural gas was 150.1 Mbd and 284.2 MMcfd, respectively. As of January 1, 2006, cumulative crude oil production totaled 2,624.8 MMb, while natural gas production reached 3,580.0 MMMcf. In 2006, average crude oil and natural gas production of the Integral Project AJB is expected to reach 145 Mbd and 293 MMcfd, respectively, though the following activities:
• completion of 21 development wells,
• 46 major workovers to wells, and
• 73 well stimulations to maintain production levels.
The estimated average production of the Integral Project AJB during the 2007-2021 period is 123.8 Mbd of crude oil and 212.2 MMcfd of natural gas, increasing in 2008 to a production level of 160.8 Mbd crude oil and 298.1 MMcfd of natural gas. The investment required to achieve this production goals is estimated to be approximately Ps. 21 billion and require the following activities:
• pressure maintenance through nitrogen injection,
• completion of 27 development wells, and
• 50 major workovers to wells. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 6/38 |
PEMEX | Investor Relations |
Figure 1
Integral Project AJB
Cantarell | During the first semester of 2006, 28 major workovers were executed and 5 wells were completed at the Cantarell Project, reaching an average production of 1,894 Mbd. For the second half of 2006, 20 major workovers and10 new wells have been programmed in order to obtain an estimated average production of 1,860 Mbd in 2006, which would represent an 8% decline in comparison to the production obtained during 2005. Based on available information and subject to achieving the investment requirements, the last estimated average production of Cantarell for 2007 and 2008 was of 1.683 and 1.430 MMbd, respectively. Likewise, different geological models and production estimates are being developed in order to update the aforementioned forecasts.
The estimated production levels reflect the actual exploitation conditions of its main field, Akal, where gas-oil contact has advanced according to schedule. This has caused the shutdown of 33 wells during the first semester of 2006. The production shutdowns are being mitigated through a phase of intensive maintenance and production, which includes the following actions:
• maintaining low nitrogen levels,
• improving drilling execution, completion and workovers, and
• initiating the operation of installations to maintain the quality of crude oil.
Moreover, the medium-term strategy focuses on:
• optimizing nitrogen injection in the different blocks of the field to maximize the final recovery of hydrocarbons,
• identifying non-drained areas, and
• utilizing new technologies which have not been applied to the development of the Akal field, such as horizontal drilling, double displacement mechanisms, slimhole drilling, and submarine completions.
The production figures previously mentioned are within the ranges of uncertainty that the performance of reservoirs and the engineering studies predict. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 7/38 |
PEMEX | Investor Relations |
Based on present information, expectations are that the infrastructure required for the next three years will include the drilling of 35 new wells and the construction of 3 platforms, 84 kilometers of oil pipelines, gas pipelines and oil and gas pipelines, and 36 kilometers of water pipelines. | ||
Gas and basic petrochemicals | ||
Gas processing and dry gas production | During the second quarter of 2006, total on-shore natural gas processing increased by 4%. This increase was attributable to:
• an increase of 165 MMcfd in sweet wet gas processing due to the rise in non-associated natural gas production from the Burgos and the Veracruz Basins; and
• a decrease of 10 MMcfd in sour wet gas processing due to lower production of heavy crude oil.
As a result of the increase in wet gas processing in the second quarter of 2006, dry gas production averaged 3,386 MMcfd, a 7% increase as compared to the second quarter of 2005, while natural gas liquids production averaged 449 MMcfd, a 1% decrease during the same period. |
Table 7
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Natural gas processed and dry gas production
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(MMcfd) | (MMcfd) | |||||||||||||||||||||
On-shore gas processed | 3,968 | 4,123 | 4 | % | 155 | 3,932 | 4,070 | 4 | % | 138 | ||||||||||||
Sour wet gas | 3,225 | 3,214 | -0.3 | % | (10 | ) | 3,212 | 3,234 | 1 | % | 22 | |||||||||||
Sweet wet gas | 744 | 909 | 22 | % | 165 | 720 | 837 | 16 | % | 117 | ||||||||||||
Production | ||||||||||||||||||||||
Dry gas | 3,175 | 3,386 | 7 | % | 211 | 3,161 | 3,335 | 5 | % | 174 | ||||||||||||
Natural gas liquids (Mbd)(1) | 455 | 449 | -1 | % | (6 | ) | 446 | 444 | -1 | % | (2 | ) |
(1) | Includes condensates. |
Note: Numbers may not total due to rounding.
Infrastructure works | In March 2006, the cryogenic plant 3 started processing 100 MMcfd of sweet wet gas in the Burgos Gas Processing Center (GPC). By the end of April full capacity tests were carried out, as well as tests for the condensates section which were consistent with the performance metrics that had been established.
The construction of the cryogenic plant 4 in the Burgos GPC continues on schedule and it is expected to start operations in the third quarter of 2006. The total processing capacity of each of these cryogenic plants 3 and 4 will be 200 MMcfd of sweet wet gas. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 8/38 |
PEMEX | Investor Relations |
Refining
Processing | During the second quarter of 2006, total crude oil processing increased by 1%, as compared to the second quarter of 2005. The processing of heavy currents decreased 5% reduction, while the processing of light currents increased by 5%. The increase in total crude oil processing was mainly due to a more stable operation of plants, as compared to the second quarter of 2005, resulting from less programmed and non-programmed maintenance works, and more reliable electric energy supply.
Nonetheless, total crude oil processing during the first six months of 2006 decreased 2% as compared to the same period in 2005, mainly as a consequence of pipeline maintenance works due to the implementation of the Safety, Health and Environmental Protection Program (or SSPA, by its acronym in Spanish). |
Table 8
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Crude oil processing
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(Mbd) | (Mbd) | |||||||||||||||||||||
Total processed | 1,299 | 1,311 | 1 | % | 12 | 1,308 | 1,288 | -2 | % | (20 | ) | |||||||||||
Heavy Currents | 540 | 514 | -5 | % | (26 | ) | 544 | 517 | -5 | % | (27 | ) | ||||||||||
Light Currents | 759 | 798 | 5 | % | 38 | 764 | 771 | 1 | % | 8 |
Note: Numbers may not total due to rounding.
Capacity utilization | In the second quarter of 2006, the primary distillation capacity utilization rate increased to 85% from 84% in the second quarter of 2005. | |
Production | During the second quarter of 2006, total refined products production increased by 0.3%, as compared to the second quarter of 2005. Gasoline and diesel production increased by 3% and 5%, respectively, while fuel oil production decreased by 8%.
The increase in gasoline and diesel production was mainly due to higher processing of crude oil and an increase in the utilization of installed capacity. The fuel oil production decrease was a consequence of lower demand from the Federal Electricity Commission (CFE). |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 9/38 |
PEMEX | Investor Relations |
Table 9
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Refining production
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(Mbd) | (Mbd) | |||||||||||||||||||||
Total production | 1,566 | 1,571 | 0.3 | % | 5 | 1,581 | 1,556 | -2 | % | (25 | ) | |||||||||||
Gasolines | 448 | 460 | 3 | % | 13 | 465 | 455 | -2 | % | (10 | ) | |||||||||||
Fuel oil | 359 | 329 | -8 | % | (30 | ) | 358 | 331 | -7 | % | (26 | ) | ||||||||||
Diesel | 315 | 332 | 5 | % | 17 | 318 | 324 | 2 | % | 7 | ||||||||||||
Liquefied petroleum gas (LPG) | 255 | 249 | -2 | % | (6 | ) | 253 | 248 | -2 | % | (5 | ) | ||||||||||
Jet Fuel | 61 | 68 | 12 | % | 7 | 64 | 65 | 2 | % | 1 | ||||||||||||
Other(1) | 128 | 133 | 4 | % | 5 | 125 | 132 | 6 | % | 8 |
(1) | Includes mainly parafines, furfural extract and aeroflex. |
Note: Numbers may not total due to rounding.
Variable refining margin | The variable refining margin is an estimate of the operating income per barrel of crude oil processed. Operating income is calculated as total revenues minus the cost of:
• inputs,
• natural gas and fuel oil used to operate the refineries, and
• electric power, water and catalysts (auxiliary services).
In the second quarter of 2006, PEMEX’s variable refining margin increased by 62%, to US$10.43 per barrel, from US$6.44 per barrel in the second quarter of 2005. This increase was primarily a result of higher production of refined products with greater added value and higher international prices of refined products. | |
Franchises | As of June 30, 2006, the number of franchised gas stations rose 6% to 7,328, from 6,940 as of June 30, 2005. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 10/38 |
PEMEX | Investor Relations |
Petrochemicals
Production | Total petrochemicals production for the second quarter of 2006 was 2,786 thousand tons (Mt), 3% greater than the total petrochemicals production in the same quarter of 2005. This increase was mainly driven by higher production of vinyl chloride, and low and high density polyethylene.
The increase in vinyl chloride production was a result of stable operations and the integration of new equipment, which increased production from 540 to 800 average tons per day in the Pajaritos Petrochemical Center vinyl chloride plant.
The increase in low and high density polyethylene in the second quarter of 2006 was due, among other causes, to the startup of operations in June of the swing plant in the Morelos Petrochemical Center and to maintenance deferments in the low density polyethylene plant in La Cangrejera Petrochemical Center. The swing plant has a production capacity of 300 annual Mt of lineal polyethylene of low and high density.
However, during the second quarter of 2006, the production of methane derivatives decreased as a consequence of lower methanol production, which resulted from a reduction in the requirements of the Madero refinery. Production of acrylonitrile halted due to a lack of demand caused by higher acrylonitrile prices. |
Table 10
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Production of petrochemicals
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
(Mt) | (Mt) | |||||||||||||||||||||
Total production | 2,704 | 2,786 | 3 | % | 82 | 5,360 | 5,411 | 1 | % | 51 | ||||||||||||
Methane derivatives | ||||||||||||||||||||||
Ammonia | 130 | 131 | 1 | % | 1 | 270 | 340 | 26 | % | 70 | ||||||||||||
Methanol | 38 | 26 | -30 | % | (11 | ) | 72 | 49 | -33 | % | (24 | ) | ||||||||||
Ethane derivatives | ||||||||||||||||||||||
Ethylene | 276 | 282 | 2 | % | 6 | 552 | 541 | -2 | % | (10 | ) | |||||||||||
Ethylene oxide | 89 | 95 | 7 | % | 6 | 182 | 175 | -4 | % | (7 | ) | |||||||||||
Low density polyethylene | 73 | 86 | 18 | % | 13 | 136 | 164 | 21 | % | 28 | ||||||||||||
High density polyethylene | 39 | 46 | 17 | % | 6 | 85 | 83 | -2 | % | (2 | ) | |||||||||||
Vinyl chloride | 38 | 53 | 40 | % | 15 | 51 | 104 | 103 | % | 53 | ||||||||||||
Aromatics and derivatives | ||||||||||||||||||||||
Toluene | 67 | 62 | -8 | % | (5 | ) | 127 | 87 | -31 | % | (39 | ) | ||||||||||
Ethylbenzene | 28 | 34 | 21 | % | 6 | 70 | 64 | -9 | % | (6 | ) | |||||||||||
Benzene | 46 | 38 | -16 | % | (7 | ) | 84 | 54 | -35 | % | (29 | ) | ||||||||||
Propylene and derivatives | ||||||||||||||||||||||
Acrylonitrile | 17 | — | — | 32 | — | — | ||||||||||||||||
Polypropylene | 94 | 88 | -7 | % | (7 | ) | 186 | 169 | -9 | % | (17 | ) | ||||||||||
Others(1) | 1,770 | 1,844 | 4 | % | 75 | 3,514 | 3,580 | 2 | % | 66 |
(1) | Includes glycols, heavy reformed, oxygen, hydrogen, nitrogen, clorhidric acid, muriatic acid, hexane, heptanes and others. |
Note: Numbers may not total due to rounding.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 11/38 |
PEMEX | Investor Relations |
International trade3
Crude oil exports | In the second quarter of 2006, PEMEX’s crude oil exports averaged 1,813 Mbd, 0.4% higher than the volume registered during the second quarter of 2005. Approximately 87% of total crude oil exports were heavy crude oil (Maya), while the rest consisted of light and extra-light crude oil (Isthmus and Olmeca).
80% of the total crude oil exports were delivered to the United States, while the remaining 20% was distributed among Europe (10%), the rest of the Americas (9%) and the Far East (1%).
In the second quarter of 2006, the weighted average export price of the Mexican crude oil basket was US$56.44 per barrel, as compared to US$41.51 per barrel in the second quarter of 2005. | |
Refined products and petrochemicals exports | Exports of refined products averaged 219 Mbd, 6% higher than in the second quarter of 2005. This was due to higher availability of naphta and condensates. The main refined products exported during the second quarter of 2006 were naphtha, light long residue and fuel oil.
Petrochemicals exports decreased by 13%, or 35 Mt, totaling 227 Mt for the quarter. This was attributable primarily to the lower availability of ethylene. The main petrochemical products exported during the first quarter of 2006 were sulphur, low-density polyethylene, and ammonia. Although sulphur is not technically a petrochemical product, it has historically been included in this category because it is a byproduct. |
Table 11
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Exports(1)
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
Crude oil exports (Mbd)(2) | ||||||||||||||||||||||
Total | 1,806 | 1,813 | 0.4 | % | 7 | 1,831 | 1,908 | 4 | % | 77 | ||||||||||||
Heavy | 1,549 | 1,572 | 1 | % | 23 | 1,581 | 1,585 | 0.3 | % | 4 | ||||||||||||
Light | 41 | 40 | -5 | % | (2 | ) | 31 | 89 | 184 | % | 57 | |||||||||||
Extra-light | 216 | 202 | -6 | % | (14 | ) | 219 | 234 | 7 | % | 15 | |||||||||||
Average price (US$/b) | 41.51 | 56.44 | 36 | % | 15 | 37.89 | 53.16 | 40 | % | 15 | ||||||||||||
Refined products (Mbd) | 206 | 219 | 6 | % | 13 | 181 | 192 | 6 | % | 11 | ||||||||||||
Petrochemicals (Mt) | 262 | 227 | -13 | % | (35 | ) | 480 | 433 | -10 | % | (47 | ) |
(1) | Source: PMI. Does not consider third party operations by PMI. |
(2) | Excludes the volume of crude oil under processing agreements. |
Note: Numbers may not total due to rounding.
3 | According to data provided by PMI |
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PEMEX | Investor Relations |
Imports | In the second quarter of 2006, natural gas imports averaged 596 MMcfd, 20% higher than the imports registered during the second quarter of 2005. Imports increased due to higher domestic demand as a result of price controls.
Imports of refined products increased by 13%, from 363 Mbd in the second quarter of 2005 to 412 Mbd in the second quarter of 2006. The increase was attributable mainly to higher local demand for gasoline and diesel. The main refined products that were imported were regular and Premium gasoline, diesel and liquefied petroleum gas (LPG).
Petrochemicals imports increased by 41%, or 25 Mt, to 86 Mt, mainly due to higher demand for isobutene, hexane-1 and methanol. |
Table 12
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Imports(1)
Second quarter (Apr. - June) | Six months ending June 30, | ||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | ||||||||||||||||
Natural gas (MMcfd) | 499 | 596 | 20 | % | 97 | 594 | 483 | -19 | % | (111 | ) | ||||||||||
Refined products (Mbd)(2) | 363 | 412 | 13 | % | 49 | 364 | 430 | 18 | % | 66 | |||||||||||
Petrochemicals (Mt) | 61 | 86 | 41 | % | 25 | 148 | 223 | 51 | % | 75 |
(1) | Source: PMI except natural gas imports. Does not consider third party operations by PMI. |
(2) | Includes the volume of imported products under processing agreements. Also, 50 Mbd and 56 Mbd of LPG for the second quarter of 2005 and 2006, respectively; and 63 Mbd and 69 Mbd of LPG for the January - June period of 2005 and 2006, respectively. |
Note: Numbers may not total due to rounding.
Financial results as of June 30, 2006
Total sales
23% increase | During the second quarter of 2006, total sales (including the special tax on production and services, or IEPS) increased by 23% in constant pesos to Ps. 281.6 billion (US$25.0 billion), as compared to Ps. 228.5 billion in the second quarter of 2005. The growth was due mainly to higher crude oil prices. |
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PEMEX | Investor Relations |
Domestic sales | During the second quarter of 2006, domestic sales, including IEPS, increased 10% to Ps. 136.2 billion (US$12.1 billion), from Ps. 123.4 billion. The IEPS totaled zero compared to the 4.0 billion in the second quarter of 2005. Domestic sales, net of IEPS, increased 14% to Ps. 136.2 billion (US$12.1 billion) from Ps. 119.3 billion. The increase in domestic sales was attributable to the following:
• Natural gas sales increased 8% to Ps. 19.9 billion (US$1.8 billion) from Ps. 18.4 billion. Natural gas sales volume increased 15% to 3,069 MMcfd from 2,666 MMcfd. During the second quarter of 2006, the average sales price of natural gas was US$6.15 per million British Thermal Unit (MMBtu), while in second quarter of 2005, the average price was US$6.57 per MMBtu.
• Sales of refined products, net of IEPS, grew 16% to Ps. 111.0 billion (US$9.8 billion) from Ps. 95.7 billion. Refined products sales volume decreased 2% to 1,748 Mbd, from 1,785 Mbd. The IEPS generated by these sales was zero in the second quarter of 2006, as compared to Ps. 4.0 billion in the second quarter of 2005. Sales of refined products, including IEPS, increased 11% to Ps. 111.0 billion (US$9.8 billion) from Ps. 99.8 billion
• Petrochemical sales increased 5% to Ps. 5.4 billion (US$0.5 billion) from Ps. 5.2 billion in the second quarter of 2005. Petrochemicals sales volume grew 4% to 952 Mt from 917 Mt. |
Table 13
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Domestic sales
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||
Domestic sales including IEPS | 123,376 | 136,241 | 10 | % | 12,865 | 12,086 | 240,593 | 262,649 | 9 | % | 22,056 | 23,300 | ||||||||||||
Domestic sales without IEPS | 119,345 | 136,241 | 14 | % | 16,897 | 12,086 | 224,642 | 262,649 | 17 | % | 38,006 | 23,300 | ||||||||||||
Natural gas | 18,441 | 19,875 | 8 | % | 1,434 | 1,763 | 36,125 | 38,881 | 8 | % | 2,756 | 3,449 | ||||||||||||
Refined products including IEPS | 99,769 | 110,950 | 11 | % | 11,181 | 9,843 | 193,700 | 213,430 | 10 | % | 19,729 | 18,934 | ||||||||||||
Refined products | 95,738 | 110,950 | 16 | % | 15,212 | 9,843 | 177,750 | 213,430 | 20 | % | 35,680 | 18,934 | ||||||||||||
IEPS | 4,031 | — | — | 15,950 | — | — | ||||||||||||||||||
Gasoline | 47,448 | 56,852 | 20 | % | 9,404 | 5,044 | 86,102 | 111,251 | 29 | % | 25,148 | 9,869 | ||||||||||||
Diesel | 20,775 | 22,413 | 8 | % | 1,638 | 1,988 | 38,665 | 44,885 | 16 | % | 6,220 | 3,982 | ||||||||||||
LPG | 11,532 | 12,321 | 7 | % | 788 | 1,093 | 23,905 | 25,710 | 8 | % | 1,805 | 2,281 | ||||||||||||
Other | 15,982 | 19,364 | 21 | % | 3,382 | 1,718 | 29,078 | 31,584 | 9 | % | 2,506 | 2,802 | ||||||||||||
Petrochemical products | 5,166 | 5,416 | 5 | % | 250 | 480 | 10,767 | 10,338 | -4 | % | -429 | 917 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table 14
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Volume of domestic sales(1)
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||
2005 | 2006 | Change | 2005 | 2006 | Change | |||||||||||||||||
Natural gas (MMcfd) | 2,666 | 3,069 | 15 | % | 403 | 2,718 | 2,897 | 7 | % | 178 | ||||||||||||
Refined products (Mbd) | 1,785 | 1,748 | -2 | % | (37 | ) | 1,767 | 1,771 | 0 | % | 4 | |||||||||||
Gasoline | 665 | 714 | 7 | % | 49 | 658 | 707 | 7 | % | 49 | ||||||||||||
Diesel | 326 | 352 | 8 | % | 25 | 313 | 343 | 10 | % | 30 | ||||||||||||
LPG | 298 | 289 | -3 | % | (9 | ) | 315 | 305 | -3 | % | (10 | ) | ||||||||||
Other | 495 | 393 | -21 | % | (103 | ) | 481 | 416 | -14 | % | (65 | ) | ||||||||||
Petrochemicals (Mt) | 917 | 952 | 4 | % | 35 | 1,862 | 1,870 | 0 | % | 8 |
Note: Numbers may not total due to rounding.
Exports | During the second quarter of 2006, export sales totaled Ps. 145.4 billion (US$12.9 billion), 38% higher than the Ps. 105.1 billion registered in the second quarter of 2005.
The distribution of such sales for the second quarter of 2006, as compared to the second quarter of 2005, was as follows:
• Crude oil and condensates export sales increased 38%, to Ps. 129.4 billion (US$11.5 billion) from Ps. 93.6 billion. Crude oil exports volume rose 0.4% from 1,806 Mbd.
• Refined products export sales rose 44% to Ps. 15.0 billion (US$1.3 billion) from Ps. 10.4 billion. Refined products exports volume grew 6% to 219 Mbd from 206 Mbd.
• Petrochemical products export sales decreased 15% to Ps. 1.0 billion (US$0.09 billion) from Ps. 1.2 billion. Petrochemical products exports volume decreased 13% to 227 Mt from 262 Mt. |
Table 15
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Exports
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||
Total exports | 105,137 | 145,374 | 38 | % | 40,237 | 12,897 | �� | 190,043 | 260,121 | 37 | % | 70,078 | 23,076 | |||||||||||||
Crude oil and condensates | 93,567 | 129,372 | 38 | % | 35,805 | 11,477 | 169,890 | 234,939 | 38 | % | 65,049 | 20,842 | ||||||||||||||
Refined products | 10,418 | 15,019 | 44 | % | 4,601 | 1,332 | 17,750 | 23,580 | 33 | % | 5,831 | 2,092 | ||||||||||||||
Petrochemical products | 1,151 | 982 | -15 | % | (169 | ) | 87 | 2,404 | 1,602 | -33 | % | (802 | ) | 142 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Costs and operating expenses
Costs and operating expenses | Costs and operating expenses increased 27%, or Ps. 26.2 billion, as compared to the second quarter of 2005, to Ps. 123.7 billion (US$11.0 billion). This variation was mainly due to:
• an increase of Ps. 2.5 billion in operating expenses, primarily due to provisions for legal proceedings,
• a decrease of Ps 2.6 billion in the variation of inventories,
• an increase of Ps. 23.4 billion in imports of products,
• an increase of Ps. 2.3 billion in the cost of the reserve for retirement payments,
• a decrease of Ps. 2.5 billion in manufacturing expenses,
• a decrease of Ps. 2.3 billion in exploration and non-successful drilling expenses,
• an increase of Ps. 6.7 billion in depreciation and amortization, and
• a decrease of Ps. 1.5 billion in upkeep and maintenance, due to a decrease in operational maintenance. | |
Cost of sales | In the second quarter of 2006, cost of sales increased 32%, or Ps. 26.0 billion, to Ps. 107.3 billion (US$9.5 billion). The increase was the result of the following:
• a favorable effect of Ps 2.6 billion in the variation of inventories,
• an increase of Ps. 23.5 billion in imports of products ,
• an unfavorable effect of Ps. 3.1 billion in operating expenses, primarily supplies and materials purchases,
• an increase of Ps. 1.4 billion in the reserve for retirement payments,
• a decrease of Ps. 2.3 billion in exploration and non-successful drilling expenses,
• a favorable effect of Ps. 2.5 billion in manufacturing expenses due to the increase in the difference between refined products prices – mainly gasoline – and crude oil prices,
• an increase of Ps. 6.7 billion in depreciation and amortization, and
• a decrease of Ps. 1.5 billion in upkeep and maintenance due mainly to a decrease in the operational maintenance. | |
Distribution expenses | During the second quarter of 2006, distribution expenses increased 12%, from Ps. 4.8 billion to Ps. 5.4 billion (US$0.5 billion). | |
Administrative expenses | During the second quarter of 2006, administrative expenses decreased 4%, from Ps. 11.5 billion to Ps. 11.0 billion (US$1.0 billion). | |
Cost of the reserve for retirement payments | The cost of the reserve for retirement payments, pensions and indemnities increased 15% in the second quarter of 2006, from Ps. 15.0 billion to Ps. 17.3 billion (US$1.5 billion). This cost is distributed among cost of sales, distribution expenses and administrative expenses. This increase reflects the natural growth of the reserve for retirement payments. |
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PEMEX | Investor Relations |
Operating income
21% increase | Operating income in the second quarter of 2006 totaled Ps. 157.9 billion (US$14.0 billion), 21% higher than the comparable figure for the second quarter of 2005 of Ps. 131.0 billion.
Excluding IEPS, operating income grew 24%, or Ps. 31.0 billion, to Ps. 157.9 billion (US$14.0 billion) from Ps. 126.9 billion. |
Comprehensive financing cost
Increase of the Comprehensive financing cost | During the second quarter of 2006, PEMEX’s comprehensive financing cost increased by Ps. 31.5 billion, from income of Ps. 9.1 billion to a cost of Ps. 22.4 billion (US$2.0 billion). This increase was caused by:
• an increase of Ps. 0.7 billion in net interest expense (interest expense minus interest income),
• an increase of Ps. 24.4 billion in the foreign exchange loss, and
• an increase of Ps. 6.4 billion in the monetary loss. | |
Net interest expense | Net interest expense, not including capitalized interest, increased 14%, from Ps. 5.3 billion to Ps. 6.0 billion (US$0.5 billion).
Interest expense decreased Ps. 5.5 billion, while interest income decreased Ps. 6.2 billion.
The decrease in interest expense was mainly due to the reclassification of some implicit derivatives from speculative to hedging. | |
Foreign exchange loss | Net foreign exchange loss totaled Ps. 10.8 billion (US$1.0 billion) in the second quarter of 2006 as compared to a net foreign exchange gain of Ps. 13.6 billion in the second quarter of 2005. This decrease was primarily a consequence of the depreciation of the Mexican peso against the US dollar by 3.5% during the second quarter of 2006, as compared to an appreciation of 3.6% in the comparable period of 2005. | |
Monetary loss | The monetary loss was Ps. 5.6 billion (US$0.5 billion), representing an increase of Ps.6.4 billion compared to the monetary gain for the second quarter of 2005. The monetary loss for the second quarter of 2006 was mainly due to a decrease in monetary assets and to a negative inflation of 0.2% in the second quarter of 2006, as compared to the positive 0.01% inflation rate in the same period of 2005. |
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PEMEX | Investor Relations |
Table 16
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Comprehensive financing cost
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||||||||
Comprehensive financing cost | (9,056 | ) | 22,399 | 31,455 | 1,987 | (5,491 | ) | 26,032 | 31,523 | 2,309 | ||||||||||||||||||||||
Interest income | (10,779 | ) | (4,554 | ) | 6,225 | (404 | ) | (12,990 | ) | (9,510 | ) | 3,480 | (844 | ) | ||||||||||||||||||
Interest expense | 16,077 | 10,587 | -34 | % | (5,490 | ) | 939 | 26,988 | 23,041 | -15 | % | (3,947 | ) | 2,044 | ||||||||||||||||||
Foreign exchange loss (gain) | (13,557 | ) | 10,808 | 24,365 | 959 | (16,617 | ) | 15,101 | 31,718 | 1,340 | ||||||||||||||||||||||
Monetary loss (gain) | (796 | ) | 5,559 | 6,355 | 493 | (2,873 | ) | (2,601 | ) | 272 | (231 | ) |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
Other revenues
IEPS credit | In the second quarter of 2006, other net revenues totaled Ps. 21.5 billion (US$1.9 billion). The corresponding figure for the second quarter of 2005 was a net revenue of Ps. 2.8 billion. The variation was mainly due to an income of Ps. 18.5 billion generated by the negative IEPS tax rate, indicating revenues owing by the Government to PEMEX. |
Income before taxes and duties
10% Increase | During the second quarter of 2006, income before taxes and duties was Ps. 157.0 billion (US$13.9 billion), as compared to Ps. 142.9 billion during the second quarter of 2005. The 10% increase was mainly the result of:
• an increase of Ps. 26.9 billion in the operating income,
• an increase of Ps. 18.6 billion in other net revenues, and
• an increase of Ps. 31.5 billion in the comprehensive financing cost. |
Taxes and duties
3% increase | During the second quarter of 2006, taxes and duties paid increased 3%, from Ps. 140.9 billion during the second quarter of 2005 to Ps. 145.4 billion (US$12.9 billion). As a percentage of total sales, taxes and duties equaled 62% and 52% in 2005 and 2006, respectively. |
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PEMEX | Investor Relations |
Ordinary hydrocarbons duty and others | During 2005, the payment of taxes and duties of Petróleos Mexicanos and its subsidiary entities was equivalent to 60.8% of total sales.4 Since January 1, 2006, PEMEX is subject to a new fiscal regime, under which Pemex-Exploration and Production is governed by the Federal Duties Law and the tax regime for the other subsidiary entities continues to be governed by Mexico’s Income Law.
Under the new fiscal regime, the most important duty paid by Pemex-Exploration and Production is the ordinary hydrocarbons duty (OHD). In contrast with the previous fiscal regime in which the tax base was total sales, the tax base for the new fiscal regime isquasi operating profit.
In addition to the payment of the OHD, Pemex-Exploration and Production pays the following duties under the new fiscal regime:
• Duty on hydrocarbons for the fund for scientific and technological research on energy,
• Duty on hydrocarbons for fiscal monitoring of oil activities,
• Duty on hydrocarbons for the stabilization fund,
• Extraordinary duty on crude oil exports,
• Additional Duty (for low crude oil extraction), and
• Excess gains duty.
During the second quarter of 2006, the amount paid of OHD and other duties increased Ps. 20.1 billion to Ps. 142.9 billion (US$12.7 billion). | |
IEPS | Until December 31, 2005, the taxes and duties paid by, Petróleos Mexicanos and its subsidiary entities included the special tax on production and services (IEPS), which applied to gasoline and automotive diesel. Under the new tax regime, IEPS continues to be governed by Mexico’s Income Law.
IEPS is paid by the end consumer of gasoline and automotive diesel and PEMEX is an intermediary between the Ministry of Finance (Secretaría de Hacienda y Crédito Público) and the end consumer. PEMEX collects the IEPS and passes it on to the federal government. The difference between the retail price and the estimated production cost of gasoline and diesel is primarily IEPS. The Ministry of Finance determines the retail price of gasoline and diesel. The estimated production cost of gasoline and diesel is based on the production cost of an efficient refinery located in the Gulf of Mexico.
During the first semester of 2006, the estimated production cost of gasoline and diesel was higher than the retail price. In accordance to Mexico’s Income Law, the difference was credited against the other taxes and duties paid by PEMEX. This credit was made through an item in other net revenues.
During the second quarter of 2006, IEPS totaled zero. In the second quarter of 2005, IEPS equaled Ps. 4.0 billion. |
4 | Subsidiary companies of Petróleos Mexicanos with addresses in Mexico have a fiscal regime similar to that of private companies in Mexico. |
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PEMEX | Investor Relations |
Excess gains duty (ARE) | In 2005, the excess gains duty was equal to 39.2% of the revenues from crude oil export sales in excess of the threshold price set by the Mexican Government of US$23.00 per barrel.
In 2006, the excess gains duty is equal to 6.5% of the revenues from crude oil export sales in excess of US$36.50 per barrel. This duty is complemented by the extraordinary duty on crude oil exports, which is equal to 13.1% of the revenues from crude oil export sales in excess of the threshold price. The resulting combined duty is equivalent to 19.6%, which is 50% of the excess gains duty tax rate paid in 2005.
During the second quarter of 2006, the excess gains duty paid by PEMEX totaled Ps. 2.4 billion (US$0.2 billion), while in the same quarter of 2005, the excess gains duty totaled Ps. 14.0 billion.
All of the proceeds from the excess gains duty and the extraordinary duty on crude oil exports in 2006 will be destined for the federal states of Mexico. The former according to thePresupuesto de Egresos de la Federación (Federal Budget) and the latter through the Stabilization Fund of the States’ Revenues. |
Table 17
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Taxes and duties
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||
Total taxes and duties | 140,912 | 145,352 | 3 | % | 4,440 | 12,895 | 264,587 | 287,676 | 9 | % | 23,089 | 25,521 | ||||||||||||||
Hydrocarbon duties | 121,785 | 140,184 | 15 | % | 18,399 | 12,436 | 224,717 | 278,527 | 24 | % | 53,810 | 24,709 | ||||||||||||||
Special Tax on Production and Services (IEPS) | 4,031 | — | (4,031 | ) | — | 15,950 | — | (15,950 | ) | — | ||||||||||||||||
Excess gains duty | 14,011 | 2,430 | -83 | % | (11,582 | ) | 216 | 21,929 | 4,131 | -81 | % | (17,798 | ) | 366 | ||||||||||||
Other taxes and duties | 1,084 | 2,738 | 153 | % | 1,655 | 243 | 1,991 | 5,018 | 152 | % | 3,028 | 445 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Net income
Ps. 11.6 billion | During the second quarter of 2006, PEMEX recorded a net income of Ps. 11.6 billion (US$1.0 billion), compared to net income of Ps. 2.0 billion during the second quarter of 2005. The Ps. 9.7 billion increase in the net income is explained by:
• an increase of Ps. 26.9 billion in operating income,
• an increase of Ps. 31.5 billion in the comprehensive financing cost,
• an increase of Ps. 18.6 billion in other net revenues, and
• an increase of Ps. 4.4 in taxes and duties. |
EBITDA
Increased 38% | During the second quarter of 2006, EBITDA increased 38%, from Ps. 158.2 billion to Ps. 217.9 billion (US$19.3 billion). |
Table 18
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
EBITDA reconciliation
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||||
Net income (loss) | 1,969 | 11,627 | 490 | % | 9,658 | 1,031 | 7,275 | 19,370 | 166 | % | 12,095 | 1,718 | ||||||||||||||||
+ Taxes and duties | 140,912 | 145,352 | 3 | % | 4,440 | 12,895 | 264,587 | 287,676 | 9 | % | 23,089 | 25,521 | ||||||||||||||||
- Special Tax on Production and Services (IEPS) | 4,031 | — | (4,031 | ) | — | 15,950 | — | (15,950 | ) | — | ||||||||||||||||||
+ Comprehensive financing cost | (9,056 | ) | 22,399 | 31,455 | 1,987 | (5,491 | ) | 26,032 | 31,523 | 2,309 | ||||||||||||||||||
+ Depreciation and amortization | 13,366 | 21,291 | 59 | % | 7,925 | 1,889 | 24,830 | 29,642 | 19 | % | 4,812 | 2,630 | ||||||||||||||||
+ Cost of the reserve for retirement payments | 15,014 | 17,264 | 15 | % | 2,251 | 1,532 | 29,061 | 34,568 | 19 | % | 5,507 | 3,067 | ||||||||||||||||
- Initial cumulative effect due to the adoption of new accounting standards | 3 | — | (3 | ) | — | 4,574 | — | (4,574 | ) | — | ||||||||||||||||||
EBITDA | 158,171 | 217,933 | 38 | % | 59,762 | 19,334 | 299,738 | 397,288 | 33 | % | 97,550 | 35,245 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Total assets
Increased 9% | As of June 30, 2006, total assets were Ps. 1,114.2 billion (US$98.8 billion), representing a 9%, or Ps. 95.6 billion, increase as compared to total assets as of June 30, 2005. The changes in the components of total assets were as follows:
• cash and cash equivalents decreased by 21%, or Ps. 25.6 billion,
• accounts receivable increased by 74%, or Ps. 72.7 billion,
• the value of inventories increased by 36%, or Ps. 16.3 billion, as a result of higher hydrocarbon prices,
• financial derivative instruments decreased by 43%, or Ps. 3.4 billion,
• properties and equipment increased by 5%, or Ps. 32.4 billion, reflecting new investments, and
• other assets increased by 2.9%, or Ps. 3.3 billion. |
Total liabilities
Increased 13% | Total liabilities increased by 13% to Ps. 1,124.4 billion (US$99.7 billion), with respect to June 30, 2005:
• short-term liabilities increased by 1.2%, or Ps. 1.7 billion, to Ps. 143.0 billion (US$12.7 billion), primarily as a result of the increase in taxes payable, and
• long-term liabilities increased by 15%, or Ps. 130.6 billion, to Ps. 981.4 billion (US$87.1 billion), mainly due to the increase in the long-term debt and the reserve for retirement payments, pensions and security premiums. | |
Reserve for retirement payments | The reserve for retirement payments, pensions and seniority premiums increased by 18%, to Ps. 402.0 billion (US$35.7 billion) from Ps. 339.4 billion. The Ps. 62.6 billion growth resulted from an increase in salary, pensions and benefits, recognition of one more year of payroll seniority, changes in labor conditions, recognition of the seniority of employees with more than one year experience (temporary employees incorporated as permanent employees), anticipated retirement benefits concessions, changes in actuarial assumptions (natural and extraordinary factors), and a decrease in the pension fund.
As of June 30, 2006, the reserve for retirement payments and the cost of the reserve for retirement payments does not consider the wages and benefit revision of the collective bargaining agreement, which was signed on July 6, 2006. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 22/38 |
PEMEX | Investor Relations |
Equity
Decrease of Ps. 36.7 billion | PEMEX’s equity decreased by Ps. 36.7 billion, from Ps. 26.5 billion to Ps. -10.2 billion (US$ -0.9 billion), with respect to June 30, 2005. The change in equity was due to:
• an increase of Ps. 79.9 billion in cumulative net losses,
• a decrease of Ps. 20.2 billion attributable to the decrease in the reserve for retirement payments, pensions and seniority premiums,
• an offsetting increase of Ps. 1.3 billion in the comprehensive income due to the application of the Bulletin C-10 “Derivative Financial Instruments and Hedge Operations”,
• an offsetting increase of Ps. 17.7 billion due to the restatement of equity, and
• an offsetting effect of Ps. 44.4 billion due to the reimbursement of the excess gains duty paid in 2005.
Under Mexican law, there are no legal consequences for decentralized public entities of the Federal Government with negative equity. As a result, there are no legal concerns regarding neither PEMEX´s current financial obligations nor its capability to generate cash.
Likewise, current financing agreements do not include financial covenants, or events of default, that could be triggered as a result of negative equity.
It is important to note that, PEMEX’s Form 20-F as of December 31, 2000, has reported negative equity in its US GAAP reconciliation. Following the application of the Mexican accounting Bulletin B-10, which incorporates the effects of inflation on financial information, PEMEX’s equity under US GAAP reconciliation was positive, as shown on PEMEX’s Form 20-F as of December 31, 2002. However, since December 31, 2003 PEMEX’s equity under the US GAAP has been negative. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 23/38 |
PEMEX | Investor Relations |
Results by segment
Refining and Petrochemical operating loss | Operating income in the first six months of 2006 totaled Ps. 305.2 billion, which was 20% higher than the comparable figure for the second quarter of 2005 of Ps. 254.9 billion.
• Pemex-Exploration and Production operating net income totaled Ps. 337.2 billion, Ps. 93.7 billion higher than the comparable figure for the first six months of 2005.
• Pemex Gas and Basic Petrochemicals operating net income totaled Ps. 6.4 billion, Ps. 0.9 billion higher than the operating income for the first six months of 2005.
• The operating loss of Pemex Refining totaled Ps. 35.1 billion , Ps. 43.7 billion higher than the operating income for the first six months of 2005. Since January 1, 2006, the IEPS credited due to a negative rate is reflected in the net loss of Pemex Refining.
• The operating loss of Pemex Petrochemicals totaled Ps. 7.1 billion, Ps. 3.8 billion higher than the operating loss for the first six months of 2005. |
Changes in financial position
Funds provided by operating activities | During the first six months of 2006, funds used by operating activities totaled Ps. 45.5 billion (US$4.0 billion), as compared to Ps. 84.0 billion of funds provided by operating activities in the first six months of 2005 The decrease of Ps. 129.5 billion was primarily due to a reduction in working capital, resulting from an increase in accounts receivable and inventories and a decrease in other liabilities, mainly taxes payable. | |
Funds provided by financing activities | During the first six months of 2006, funds provided by financing activities totaled Ps. 68.1 billion (US$6.0 billion). The increase was mainly due to the issuance of debt securities and new bank loan financing. | |
Funds used in investing activities | During the first six months of 2006, funds used in investing activities totaled Ps. 46.4 billion (US$4.1 billion), primarily as a result of investments in fixed assets. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 24/38 |
PEMEX | Investor Relations |
Financing activities
Financing requirements
Funds raised year to date | During the first six months of 2006, US$2.7 billion were raised, distributed as follows:
• US$1.5 billion from international capital markets
• US$0.9 billion from the Mexican capital market
• US$0.35 billion from export credit agencies (ECA’s)
Of the total amount, 68% has been raised in international markets. | |
Financing program | The financing program for the remainder of 2006 depends on the possibility of financing projects with internal resources. This alternative is still under discussion with the Ministry of Finance (SHCP).
As in previous years, PEMEX may continue pre-funding its financing program for 2007, depending on market conditions. |
Capital markets
Master Trust | The Pemex Project Funding Master Trust, a Delaware trust controlled by, and whose debt is guaranteed by PEMEX, entered into the following financings during 2006:
• On February 2, 2006 it reopened two issuances originally issued on June 8, 2005:
• US$750 million of its 5.75% notes due in 2015
• US$750 million of its 6.625% bonds due in 2035
• On May 3, 2006 it signed a US$1,250 million syndicated credit facility maturing in three years. This line can be used either by the Pemex Project Funding Master Trust or by Petróleos Mexicanos
• On May 18, 2006 it closed a US$4,250 million syndicated loan which will be used to refinance the syndicated loan signed on March 22, 2005. It is divided into two tranches:
• Tranch A: US$1,500 million maturing in five years
• Tranch B: US$2,750 million with a final maturity in seven years | |
F/163 | The Fideicomiso F/163, a Mexican trust whose debt is guaranteed by PEMEX, issued notes for Ps. 10,000 million due in seven years, on June 16, 2006. These notes will pay a monthly coupon rate equivalent to the Mexican interbank rate (TIIE) less 0.07%. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 25/38 |
PEMEX | Investor Relations |
Total debt
Total debt of US$54.4 billion | As of June 30, 2006, total consolidated debt including accrued interest was Ps. 611.8 billion (US$54.3 billion). This figure represents an increase of 19%, or Ps.95.7 billion, as compared to the figure recorded as of June 20, 2005. Total consolidated debt is documented debt5 of Petróleos Mexicanos and the Pemex Project Funding Master Trust, the Fideicomiso F/163, RepCon Lux S.A. and Pemex Finance, Ltd. | |
Net debt of US$45.7 billion | Net debt, or the difference between total debt and cash equivalents, increased Ps. 121.3 billion, to Ps. 514.0 billion (US$ 45.6 billion) as of June 30, 2006, from Ps. 392.7 billion, as of June 30, 2005. |
Table 19
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Consolidated total debt
As of June 30, | ||||||||||||
2005 | 2006 | Change | 2006 | |||||||||
(Ps. mm) | (US$mm) | |||||||||||
Documented debt(1) | 507,647 | 611,839 | 21 | % | 104,191 | 54,278 | ||||||
Short-term | 32,120 | 63,089 | 96 | % | 30,969 | 5,597 | ||||||
Long-term | 475,528 | 548,750 | 15 | % | 73,222 | 48,681 | ||||||
Sale of future accounts receivable(2) | 8,500 | — | — | |||||||||
Long-term | 8,500 | — | — | |||||||||
Total debt | 516,147 | 611,839 | 19 | % | 95,692 | 54,278 | ||||||
Short-term | 32,120 | 63,089 | 96 | % | 30,969 | 5,597 | ||||||
Long-term | 484,028 | 548,750 | 13 | % | 64,722 | 48,681 | ||||||
Cash & cash equivalents | 123,423 | 97,800 | -21 | % | (25,623 | ) | 8,676 | |||||
Total net debt | 392,724 | 514,039 | 31 | % | 121,315 | 45,602 |
* | Derived from unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
(1) | Consistent with debt figures presented in U.S. Securities and Exchange Commission filings. |
(2) | Represents Pemex Finance Ltd debt, which in 2006 is included as part of long-term debt. |
Note: Numbers may not total due to rounding.
Short-term debt | Total debt with less than twelve months maturity was Ps. 63.1 billion (US$5.6 billion). | |
Long-term debt | Total long-term debt was Ps. 548.7 billion (US$48.7 billion). |
5 | The external auditors recommended that notes payable to contractors should be consolidated in documented debt, as of December 31, 2005. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 26/38 |
PEMEX | Investor Relations |
Maturity profile | The following table shows the maturity profile of PEMEX’s total debt by currency: |
Table 20
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Maturity profile
As of June 30, | ||||
(Ps. mm) | US$mm | |||
Documented debt in pesos | 116,765 | 10,359 | ||
2006 | 1,316 | 117 | ||
Jan - Jun 2007 | 722 | 64 | ||
Jul 2007 - Jun 2008 | 17,944 | 1,592 | ||
Jul 2008 - Jun 2009 | 4,667 | 414 | ||
Jul 2009 - Jun 2010 | 26,013 | 2,308 | ||
July 2010 and beyond | 66,103 | 5,864 | ||
Documented debt in other currencies | 495,073 | 43,919 | ||
2006 | 47,427 | 4,207 | ||
Jan - Jun 2007 | 13,624 | 1,209 | ||
Jul 2007 - Jun 2008 | 53,915 | 4,783 | ||
Jul 2008 - Jun 2009 | 48,081 | 4,265 | ||
Jul 2009 - Jun 2010 | 50,731 | 4,501 | ||
July 2010 and beyond | 281,296 | 24,955 | ||
Total debt | 611,839 | 54,278 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
Duration | PEMEX plans to smooth its maturity profile regardless of its duration. The average duration of its debt exposure is presented in the following table. |
Table 21
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Average duration of debt exposure
As of June 30, | |||||||
2005 | 2006 | Change | |||||
(Years) | |||||||
U.S. Dollars | 4.5 | 3.9 | (0.6 | ) | |||
Mexican pesos | 1.8 | 1.9 | 0.02 | ||||
Euros | 1.2 | 2.3 | 1.1 | ||||
Japanese yen | 2.6 | 2.1 | (0.5 | ) | |||
Swiss francs | 0.2 | 0.0 | (0.2 | ) | |||
Total | 4.0 | 3.5 | (0.5 | ) |
Note: Numbers may not total due to rounding.
Interest rate risk | PEMEX´s policy is to maintain a balance between fixed and floating rate liabilities in order to mitigate the impact of fluctuations in interest rates. As of June 30, 2006, approximately 59% of PEMEX’s debt exposure carried fixed interest rates, and the remaining 41% carried floating rates. |
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 27/38 |
PEMEX | Investor Relations |
Debt exposure | The following table sets forth PEMEX’s debt exposure to currency and interest rate risk: |
Table 22
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Debt exposure
(excluding accrued interest)
As of June 30, | ||||||||||||||||||
2005 | 2006 | 2005 | 2006 | 2005 | 2006 | |||||||||||||
Percentage | ||||||||||||||||||
By currency | At fixed rate | At floating rate | ||||||||||||||||
U.S. Dollars | 80.3 | % | 80.2 | % | 67.5 | % | 62.5 | % | 32.5 | % | 37.5 | % | ||||||
Mexican pesos | 19.6 | % | 19.7 | % | 44.0 | % | 45.2 | % | 56.0 | % | 54.8 | % | ||||||
Euros | 0.005 | % | 0.00 | % | 24.9 | % | 62.7 | % | 75.1 | % | 37.3 | % | ||||||
Japanese yen | 0.17 | % | 0.12 | % | 100.0 | % | 100.0 | % | 0.0 | % | 0.0 | % | ||||||
Swiss francs | 0.0003 | % | 0.0 | % | 0.0 | % | 0.0 | % | 100.00 | % | 0.0 | % | ||||||
Total | 100.0 | % | 100.0 | % | 62.9 | % | 59.2 | % | 37.1 | % | 40.8 | % |
Note: Numbers may not total due to rounding.
Other relevant topics
Incidents | During the second quarter of 2006, the following incidents occurred in the states of Colima, Hidalgo, Oaxaca, Puebla, Querétaro, Tabasco, Tamaulipas, Veracruz and Yucatán:
• On April 25, 2006 a crude oil leak was originated by an illegal tapping on a pipeline located in the town of Venta Chicha, near the Huachinango municipality in the state of Puebla.
• On April 26, 2006 an illegal tapping that caused a Magna gasoline leak was detected. The leakage occurred in kilometer 133 of a 16-inch diameter pipeline which links the Tula and Salamanca refineries in the state of Querétaro.
• On May 13, 2006, a Magna gasoline leak occurred in the pipelines that carry out hydrocarbons in a storage and distribution facility located in Progreso, Yucatán. The leak was caused by the rupture of a monoblock seal in the 16-inch diameter pipeline.
• On May 24, 2006, a crude oil leak in the Cucharas River, at the Tantima municipality in Veracruz, was controlled. The leak occurred around kilometer 128 in the Poza Rica - Madero crude oil pipeline.
• On May 29, 2006, an illegal tapping that caused a Magna gasoline leak was controlled and repaired. The leak occurred around kilometer 165, near the municipality Mineral de la Reforma, in the Poza Rica- Cima de Togo-Tula 14-inch diameter pipeline in the state of Veracruz.
• On May 31, 2006 lightning hit a polyethylene plant in the Petrochemical Center La Cangrejera. The incident provoked a fire.
• On June 4, 2006 a diesel fuel leak in the Madero-Cadereyta pipeline was controlled. The leak occurred near kilometer 55 on the Tampico-Mante road.
• On June 13, 2006 two liters of crude oil were leaked in the offloading 4-inch diameter pipeline of the Tamaulipas 159 well in the Altamira municipality in the state of Tamaulipas. The leak was caused by attrition in the rubber packing of the pipeline clamp. |
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PEMEX | Investor Relations |
• On June 19, 2006 waves reaching up to six meters in height in Salina Cruz, Oaxaca, caused a heavy fuel oil leakage.
• On June 25, 2006, a diesel fuel leak caused a fire in the Tula refinery.
• On June 25, 2006 a crude oil leak was registered in the 24-inch diameter pipeline in the municipality of Cunduacán, in the state of Tabasco.
• On June 26, 2006 a fire occurred in the polyethylene plant at La Cangrejera Petrochemical Center.
• On June 28, 2006 lightning hit a gasoline storage tank, in the Minatitlán refinery, and caused a fire.
• On July 9, 2006 a leak of 38 crude oil barrels occurred in Tabasco. The incident was registered in an 8-inch off loading pipeline of the Agave 53 and 611 wells.
• On July 27, 2006, a leak of approximately 280 barrels of fuel oil occurred in a 20-inch diameter pipeline in Manzanillo Colima.
PEMEX - in collaboration with the Governments of the states of Colima, Hidalgo, Oaxaca, Puebla, Querétaro, Tabasco, Tamaulipas, Veracruz and Yucatán, the Mexican Army and Navy, municipal authorities and Civil Protection, among others - has implemented contingency plans to protect and reestablish the health and integrity of the population of the affected areas and counteract any negative environmental impact. | ||
Wages revision | On July 6, 2006, Petróleos Mexicanos and its Union the Sindicato de Trabajadores Petroleros de la República Mexicana, or STPRM, entered into the annual wages and benefits revision to the collective bargaining agreement. This year’s revision consists of a 4.1% increase to wages and a 1.7% increase to benefits. |
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PEMEX | Investor Relations |
Annex
Table A1
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Crude oil production by selected fields (quarterly)
2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||||||||
1Q | 2Q | 3Q | 4Q | 1Q | 2Q | 3Q | 4Q | 1Q | 2Q | |||||||||||||||||||
(Mbd) | ||||||||||||||||||||||||||||
Total | 3,012 | 3,127 | 3,177 | 3,371 | 3,382 | 3,422 | 3,382 | 3,346 | 3,316 | 3,425 | 3,286 | 3,306 | 3,345 | 3,329 | ||||||||||||||
Northeast Marine Region | 1,763 | 1,986 | 2,152 | 2,416 | 2,440 | 2,479 | 2,436 | 2,408 | 2,375 | 2,450 | 2,305 | 2,300 | 2,334 | 2,289 | ||||||||||||||
Akal and Nohoch | 1,420 | 1,673 | 1,851 | 2,054 | 2,085 | 2,110 | 2,074 | 2,047 | 2,067 | 2,041 | 1,905 | 1,883 | 1,882 | 1,797 | ||||||||||||||
Ku | 205 | 176 | 185 | 197 | 185 | 194 | 197 | 189 | 159 | 213 | 213 | 225 | 244 | 278 | ||||||||||||||
Zaap | 30 | 26 | 21 | 41 | 53 | 53 | 54 | 68 | 53 | 77 | 75 | 71 | 82 | 76 | ||||||||||||||
Maloob | 50 | 45 | 35 | 50 | 51 | 55 | 55 | 50 | 38 | 51 | 48 | 50 | 57 | 64 | ||||||||||||||
Chac | 18 | 22 | 17 | 20 | 23 | 23 | 11 | 11 | 10 | 13 | 12 | 12 | 13 | 13 | ||||||||||||||
Kutz | — | 5 | 9 | 13 | 9 | 12 | 13 | 13 | 10 | 14 | 11 | 11 | 12 | 12 | ||||||||||||||
Otros | 40 | 40 | 32 | 41 | 34 | 33 | 31 | 30 | 37 | 40 | 39 | 48 | 44 | 50 | ||||||||||||||
Southwest Marine Region | 622 | 554 | 452 | 398 | 389 | 391 | 388 | 384 | 381 | 394 | 390 | 419 | 428 | 454 | ||||||||||||||
Caan | 182 | 163 | 133 | 114 | 107 | 109 | 109 | 106 | 102 | 100 | 95 | 94 | 93 | 90 | ||||||||||||||
Chuc | 140 | 118 | 107 | 99 | 92 | 93 | 93 | 94 | 98 | 103 | 99 | 112 | 111 | 106 | ||||||||||||||
Abkatún | 108 | 103 | 80 | 69 | 59 | 57 | 52 | 50 | 49 | 47 | 41 | 38 | 34 | 31 | ||||||||||||||
Taratunich | 50 | 43 | 39 | 36 | 35 | 33 | 33 | 32 | 27 | 24 | 17 | 19 | 24 | 33 | ||||||||||||||
Pol | 74 | 62 | 42 | 35 | 30 | 28 | 23 | 21 | 19 | 18 | 16 | 14 | 14 | 13 | ||||||||||||||
Otros | 69 | 64 | 51 | 44 | 67 | 72 | 78 | 81 | 86 | 102 | 122 | 142 | 152 | 181 | ||||||||||||||
South Region | 550 | 509 | 498 | 483 | 474 | 471 | 475 | 471 | 479 | 495 | 508 | 504 | 499 | 501 | ||||||||||||||
Puerto Ceiba | 17 | 21 | 38 | 46 | 70 | 79 | 82 | 77 | 77 | 81 | 81 | 70 | 63 | 59 | ||||||||||||||
Samaria | 83 | 83 | 71 | 73 | 66 | 64 | 60 | 59 | 60 | 64 | 68 | 69 | 66 | 64 | ||||||||||||||
Iride | 45 | 43 | 43 | 44 | 45 | 46 | 46 | 48 | 48 | 50 | 51 | 52 | 51 | 50 | ||||||||||||||
Jujo | 61 | 56 | 56 | 51 | 47 | 45 | 45 | 41 | 45 | 52 | 51 | 51 | 54 | 58 | ||||||||||||||
Cunduacán | 24 | 22 | 21 | 23 | 24 | 24 | 28 | 28 | 28 | 30 | 27 | 25 | 23 | 23 | ||||||||||||||
Tecominoacán | 32 | 29 | 27 | 23 | 21 | 19 | 18 | 19 | 20 | 22 | 23 | 25 | 28 | 31 | ||||||||||||||
Cárdenas | 23 | 20 | 16 | 14 | 14 | 14 | 13 | 11 | 11 | 14 | 18 | 18 | 19 | 21 | ||||||||||||||
Sen | 30 | 33 | 31 | 21 | 9 | 11 | 15 | 16 | 17 | 18 | 19 | 21 | 22 | 22 | ||||||||||||||
Pijije | 4 | 5 | 9 | 12 | 12 | 11 | 11 | 10 | 10 | 12 | 14 | 14 | 14 | 15 | ||||||||||||||
Jolote | 20 | 16 | 15 | 12 | 12 | 11 | 11 | 10 | 9 | 10 | 10 | 9 | 9 | 9 | ||||||||||||||
Cactus | 11 | 12 | 10 | 12 | 11 | 11 | 11 | 10 | 11 | 9 | 9 | 8 | 8 | 9 | ||||||||||||||
Bellota | 10 | 9 | 10 | 8 | 10 | 10 | 9 | 9 | 10 | 9 | 9 | 8 | 8 | 8 | ||||||||||||||
Chinchorro | 10 | 10 | 9 | 10 | 10 | 9 | 8 | 8 | 8 | 8 | 8 | 7 | 7 | 7 | ||||||||||||||
Yagual | 4 | 4 | 4 | 4 | 4 | 5 | 7 | 10 | 11 | 11 | 13 | 12 | 11 | 10 | ||||||||||||||
Rodador | 2 | 2 | 3 | 7 | 7 | 7 | 6 | 5 | 5 | 5 | 5 | 6 | 4 | 4 | ||||||||||||||
Otros | 174 | 144 | 136 | 122 | 111 | 107 | 107 | 108 | 108 | 101 | 104 | 110 | 111 | 112 | ||||||||||||||
North Region | 77 | 79 | 75 | 74 | 80 | 80 | 82 | 83 | 81 | 86 | 84 | 83 | 84 | 85 | ||||||||||||||
Poza Rica | 10 | 11 | 10 | 10 | 10 | 11 | 12 | 11 | 10 | 10 | 10 | 9 | 10 | 10 | ||||||||||||||
Arenque | 6 | 8 | 8 | 9 | 8 | 8 | 8 | 9 | 10 | 10 | 9 | 9 | 8 | 9 | ||||||||||||||
Agua Fría | 3 | 2 | 2 | 2 | 6 | 6 | 6 | 8 | 6 | 6 | 5 | 6 | 7 | 8 | ||||||||||||||
Tajín | 2 | 1 | 1 | 3 | 6 | 6 | 6 | 5 | 6 | 6 | 6 | 6 | 6 | 5 | ||||||||||||||
Tamaulipas | 8 | 8 | 7 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | ||||||||||||||
Constituciones | 7 | 7 | 6 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | ||||||||||||||
Otros | 42 | 41 | 40 | 39 | 39 | 38 | 40 | 38 | 39 | 43 | 43 | 43 | 43 | 43 |
Note: Numbers may not total due to rounding.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 30/38 |
PEMEX | Investor Relations |
Table A2
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Natural gas production by selected fields (quarterly)
2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||||||||
1Q | 2Q | 3Q | 4Q | 1Q | 2Q | 3Q | 4Q | 1Q | 2Q | |||||||||||||||||||
(MMcfd) | ||||||||||||||||||||||||||||
Total | 4,679 | 4,511 | 4,423 | 4,498 | 4,557 | 4,570 | 4,577 | 4,586 | 4,640 | 4,861 | 4,839 | 4,928 | 5,094 | 5,281 | ||||||||||||||
Northeast Marine Region | 737 | 794 | 831 | 940 | 948 | 959 | 945 | 938 | 918 | 965 | 914 | 915 | 931 | 958 | ||||||||||||||
Akal and Nohoch | 543 | 610 | 676 | 750 | 761 | 770 | 757 | 747 | 755 | 745 | 695 | 687 | 687 | 698 | ||||||||||||||
Ku | 133 | 123 | 98 | 111 | 102 | 101 | 102 | 98 | 82 | 106 | 109 | 115 | 127 | 152 | ||||||||||||||
Otros | 60 | 61 | 57 | 80 | 85 | 89 | 86 | 93 | 81 | 113 | 110 | 113 | 117 | 108 | ||||||||||||||
Southwest Marine Region | 820 | 736 | 621 | 581 | 609 | 600 | 599 | 602 | 601 | 654 | 656 | 707 | 750 | 810 | ||||||||||||||
Caan | 278 | 258 | 215 | 206 | 222 | 221 | 207 | 212 | 207 | 216 | 205 | 198 | 196 | 189 | ||||||||||||||
Chuc | 177 | 148 | 131 | 119 | 105 | 92 | 92 | 92 | 97 | 108 | 117 | 130 | 118 | 113 | ||||||||||||||
Taratunich | 75 | 67 | 65 | 67 | 69 | 65 | 67 | 62 | 54 | 49 | 32 | 37 | 57 | 73 | ||||||||||||||
Sinan | — | — | — | 1 | 32 | 44 | 57 | 61 | 63 | 80 | 89 | 88 | 94 | 104 | ||||||||||||||
Abkatún | 82 | 78 | 62 | 56 | 52 | 49 | 45 | 42 | 43 | 42 | 33 | 27 | 33 | 31 | ||||||||||||||
Uech | 51 | 45 | 43 | 40 | 39 | 40 | 36 | 32 | 28 | 25 | 22 | 25 | 26 | 28 | ||||||||||||||
Otros | 157 | 139 | 104 | 92 | 91 | 89 | 96 | 101 | 109 | 134 | 160 | 203 | 226 | 272 | ||||||||||||||
South Region | 1,857 | 1,743 | 1,704 | 1,630 | 1,532 | 1,507 | 1,486 | 1,456 | 1,419 | 1,408 | 1,398 | 1,377 | 1,361 | 1,318 | ||||||||||||||
Muspac | 216 | 212 | 235 | 215 | 171 | 146 | 133 | 128 | 124 | 116 | 117 | 104 | 92 | 86 | ||||||||||||||
Samaria | 113 | 114 | 94 | 99 | 102 | 102 | 106 | 99 | 94 | 89 | 89 | 79 | 78 | 76 | ||||||||||||||
Catedral | 134 | 123 | 124 | 128 | 111 | 104 | 95 | 92 | 82 | 75 | 71 | 68 | 66 | 54 | ||||||||||||||
Giraldas | 96 | 102 | 103 | 96 | 91 | 90 | 87 | 87 | 83 | 78 | 69 | 67 | 64 | 61 | ||||||||||||||
Copano | 79 | 86 | 80 | 82 | 84 | 84 | 74 | 72 | 70 | 68 | 64 | 59 | 60 | 55 | ||||||||||||||
Cunduacán | 64 | 57 | 51 | 55 | 72 | 70 | 72 | 69 | 77 | 90 | 90 | 94 | 99 | 101 | ||||||||||||||
Iride | 68 | 76 | 74 | 77 | 67 | 69 | 68 | 77 | 83 | 92 | 96 | 102 | 109 | 109 | ||||||||||||||
Puerto Ceiba | 11 | 18 | 24 | 29 | 43 | 52 | 58 | 57 | 52 | 54 | 53 | 47 | 43 | 39 | ||||||||||||||
Jujo | 82 | 81 | 71 | 58 | 47 | 46 | 48 | 41 | 46 | 53 | 59 | 59 | 64 | 54 | ||||||||||||||
José Colomo | 63 | 60 | 47 | 37 | 37 | 35 | 35 | 35 | 35 | 35 | 36 | 35 | 32 | 31 | ||||||||||||||
Sen | 86 | 92 | 91 | 64 | 25 | 30 | 38 | 39 | 41 | 45 | 47 | 53 | 56 | 57 | ||||||||||||||
Pijije | 12 | 14 | 26 | 35 | 35 | 32 | 32 | 30 | 29 | 34 | 41 | 42 | 42 | 42 | ||||||||||||||
Luna | 110 | 89 | 85 | 51 | 36 | 33 | 31 | 30 | 30 | 21 | 25 | 21 | 21 | 20 | ||||||||||||||
Tecominoacán | 40 | 37 | 30 | 25 | 30 | 30 | 30 | 33 | 31 | 36 | 33 | 35 | 40 | 41 | ||||||||||||||
Saramako | — | — | 2 | 14 | 21 | 23 | 32 | 36 | 29 | 28 | 25 | 22 | 20 | 19 | ||||||||||||||
Cárdenas | 47 | 35 | 31 | 28 | 24 | 23 | 30 | 29 | 26 | 29 | 40 | 38 | 41 | 41 | ||||||||||||||
Cactus | 21 | 22 | 19 | 25 | 26 | 25 | 27 | 23 | 25 | 23 | 22 | 22 | 20 | 23 | ||||||||||||||
Bellota | 26 | 25 | 28 | 27 | 29 | 30 | 20 | 22 | 26 | 26 | 23 | 24 | 23 | 21 | ||||||||||||||
Otros | 590 | 501 | 489 | 486 | 480 | 481 | 471 | 456 | 438 | 415 | 401 | 405 | 393 | 388 | ||||||||||||||
North Region | 1,266 | 1,238 | 1,268 | 1,347 | 1,469 | 1,504 | 1,547 | 1,590 | 1,703 | 1,834 | 1,871 | 1,930 | 2,052 | 2,196 | ||||||||||||||
Culebra | 320 | 274 | 219 | 201 | 179 | 164 | 153 | 182 | 182 | 185 | 167 | 153 | 157 | 161 | ||||||||||||||
Cuitláhuac | 122 | 126 | 109 | 91 | 92 | 104 | 129 | 127 | 116 | 115 | 116 | 117 | 121 | 120 | ||||||||||||||
Arcos | 199 | 175 | 148 | 141 | 128 | 115 | 90 | 82 | 76 | 81 | 101 | 109 | 104 | 101 | ||||||||||||||
Cocuite | 18 | 27 | 45 | 90 | 112 | 99 | 102 | 92 | 84 | 77 | 71 | 65 | 57 | 52 | ||||||||||||||
Vistoso | — | — | — | 8 | 59 | 79 | 85 | 95 | 111 | 118 | 119 | 120 | 120 | 116 | ||||||||||||||
Santa Rosalia | 9 | 24 | 63 | 53 | 62 | 66 | 70 | 55 | 56 | 56 | 58 | 71 | 55 | 48 | ||||||||||||||
Corindón | 26 | 40 | 59 | 59 | 62 | 49 | 44 | 44 | 45 | 41 | 36 | 49 | 48 | 49 | ||||||||||||||
Arcabuz | 93 | 57 | 46 | 33 | 38 | 35 | 41 | 47 | 54 | 67 | 76 | 65 | 71 | 77 | ||||||||||||||
Torrecillas | 1 | 5 | 21 | 34 | 36 | 46 | 38 | 36 | 36 | 41 | 41 | 43 | 43 | 35 | ||||||||||||||
Velero | 2 | 9 | 13 | 22 | 41 | 36 | 38 | 38 | 50 | 50 | 49 | 51 | 54 | 65 | ||||||||||||||
Arenque | 27 | 28 | 29 | 30 | 32 | 32 | 33 | 32 | 31 | 32 | 33 | 31 | 32 | 34 | ||||||||||||||
Copite | 47 | 35 | 33 | 27 | 28 | 29 | 30 | 30 | 28 | 27 | 22 | 26 | 27 | 25 | ||||||||||||||
Otros | 402 | 439 | 482 | 557 | 601 | 648 | 693 | 732 | 833 | 945 | 982 | 1,030 | 1,163 | 1,311 |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table A3
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Consolidated balance sheets
As of June 30, | ||||||||||||||
2005 | 2006 | Change | 2006 | |||||||||||
(Ps. mm) | (US$mm) | |||||||||||||
Current assets | 274,393 | 334,396 | 22 | % | 60,003 | 29,665 | ||||||||
Cash & cash equivalents | 123,423 | 97,800 | -21 | % | (25,623 | ) | 8,676 | |||||||
Accounts receivable | 97,764 | 170,435 | 74 | % | 72,671 | 15,120 | ||||||||
Inventories | 45,364 | 61,711 | 36 | % | 16,347 | 5,475 | ||||||||
Financial derivative instruments | 7,842 | 4,451 | -43 | % | (3,391 | ) | 395 | |||||||
Properties and equipment | 631,844 | 664,220 | 5 | % | 32,376 | 58,925 | ||||||||
Other assets | 112,302 | 115,556 | 2.9 | % | 3,254 | 10,251 | ||||||||
Total assets | 1,018,539 | 1,114,172 | 9 | % | 95,633 | 98,842 | ||||||||
Short-term liabilities | 141,291 | 143,004 | 1.2 | % | 1,713 | 12,686 | ||||||||
Short-term debt(1) | 32,120 | 63,089 | 96 | % | 30,969 | 5,597 | ||||||||
Suppliers | 23,127 | 27,997 | 21 | % | 4,869 | 2,484 | ||||||||
Accounts payable and accrued expenses | 13,686 | 24,254 | 77 | % | 10,568 | 2,152 | ||||||||
Taxes payable | 61,789 | 17,344 | -72 | % | (44,445 | ) | 1,539 | |||||||
Financial derivative instruments | 10,569 | 10,321 | -2 | % | (248 | ) | 916 | |||||||
Long-term liabilities | 850,753 | 981,379 | 15 | % | 130,627 | 87,061 | ||||||||
Long-term debt(2) | 484,028 | 548,750 | 13 | % | 64,722 | 48,681 | ||||||||
Reserve for retirement payments, pensions and seniority premiums | 339,395 | 401,976 | 18 | % | 62,581 | 35,661 | ||||||||
Other non-current liabilities(3) | 27,330 | 30,653 | 12 | % | 3,323 | 2,719 | ||||||||
Total liabilities | 992,043 | 1,124,383 | 13 | % | 132,340 | 99,747 | ||||||||
Total equity | 26,496 | (10,211 | ) | -139 | % | (36,707 | ) | (906 | ) | |||||
Total liabilities & equity | 1,018,539 | 1,114,172 | 9 | % | 95,633 | 98,842 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
(1) | Includes maturities shorter than twelve months of documented debt (Petróleos Mexicanos, the Pemex Project Funding Master Trust, the Mexican Trust F/163, Pemex Finance and RepconLux) and notes payable to contractors. |
(2) | Includes maturities longer than twelve months of documented debt (Petróleos Mexicanos, the Pemex Project Funding Master Trust, the Mexican Trust F/163, Pemex Finance and Repcon Lux), notes payable to contractors and sale of future accounts receivable. |
(3) | Corresponds to the balance of the reserve for dismantlement and abandonment activities, sundry creditors and others. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table A4
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Consolidated income statement
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||||||
Total sales | 228,513 | 281,615 | 23 | % | 53,102 | 24,983 | 430,636 | 522,770 | 21 | % | 92,134 | 46,377 | ||||||||||||||||||
Domestic sales(1) | 123,376 | 136,241 | 10 | % | 12,865 | 12,086 | 240,593 | 262,649 | 9 | % | 22,056 | 23,300 | ||||||||||||||||||
Exports | 105,137 | 145,374 | 38 | % | 40,237 | 12,897 | 190,043 | 260,121 | 37 | % | 70,078 | 23,076 | ||||||||||||||||||
Costs and expenses(2) | 97,537 | 123,691 | 27 | % | 26,154 | 10,973 | 175,720 | 217,543 | 24 | % | 41,823 | 19,299 | ||||||||||||||||||
Cost of sales | 81,247 | 107,282 | 32 | % | 26,035 | 9,517 | 143,677 | 183,343 | 28 | % | 39,666 | 16,265 | ||||||||||||||||||
Distribution expenses | 4,773 | 5,366 | 12 | % | 593 | 476 | 9,587 | 10,856 | 13 | % | 1,270 | 963 | ||||||||||||||||||
Administrative expenses | 11,517 | 11,043 | -4 | % | (474 | ) | 980 | 22,456 | 23,344 | 4 | % | 887 | 2,071 | |||||||||||||||||
Operating income | 130,976 | 157,924 | 21 | % | 26,948 | 14,010 | 254,916 | 305,228 | 20 | % | 50,312 | 27,078 | ||||||||||||||||||
Comprehensive financing cost | (9,056 | ) | 22,399 | 31,455 | 1,987 | (5,491 | ) | 26,032 | 31,523 | 2,309 | ||||||||||||||||||||
Other expenses (revenues) | (2,846 | ) | (21,454 | ) | (18,608 | ) | (1,903 | ) | (6,882 | ) | (27,851 | ) | (20,969 | ) | (2,471 | ) | ||||||||||||||
Income before taxes and duties | 142,878 | 156,979 | 10 | % | 14,101 | 13,926 | 267,289 | 307,047 | 15 | % | 39,758 | 27,239 | ||||||||||||||||||
Taxes and duties | 140,912 | 145,352 | 3 | % | 4,440 | 12,895 | 264,587 | 287,676 | 9 | % | 23,089 | 25,521 | ||||||||||||||||||
Hydrocarbon duties and other | 136,880 | 145,352 | 6 | % | 8,472 | 12,895 | 248,637 | 287,676 | 16 | % | 39,039 | 25,521 | ||||||||||||||||||
Special Tax on Production and | ||||||||||||||||||||||||||||||
Services (IEPS) | 4,031 | — | (4,031 | ) | — | 15,950 | — | (15,950 | ) | — | ||||||||||||||||||||
Initial cumulative effect due to the adoption of new accounting standards | 2.8 | — | (3 | ) | — | 4,574 | — | (4,574 | ) | — | ||||||||||||||||||||
Net income (loss) | 1,969 | 11,627 | 490 | % | 9,658 | 1,031 | 7,275 | 19,370 | 166 | % | 12,095 | 1,718 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
(1) | Includes the Special Tax on Production and Services (IEPS). |
(2) | Includes the cost of the reserve for retirement payments, pensions and indemnities. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table A5
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Equity
As of June 30, | |||||||||||||||
2005 | 2006 | Change | 2006 | ||||||||||||
(Ps. mm) | (US$mm) | ||||||||||||||
Total equity | 26,496 | (10,211 | ) | -139 | % | (36,707 | ) | (906 | ) | ||||||
Certificates of contribution “A” | 90,395 | 90,395 | — | 8,019 | |||||||||||
Capitalized proceeds | 35,008 | 79,454 | 127 | % | 44,446 | 7,049 | |||||||||
Effect of the reserve for retirement payments | (7,261 | ) | (27,461 | ) | (20,200 | ) | (2,436 | ) | |||||||
Comprehensive income | (3,467 | ) | (2,213 | ) | 1,255 | (196 | ) | ||||||||
Restatement of equity | 135,330 | 153,072 | 13 | % | 17,742 | 13,579 | |||||||||
Accumulated net income (losses) | (223,509 | ) | (303,459 | ) | (79,949 | ) | (26,921 | ) | |||||||
From prior years | (230,785 | ) | (322,829 | ) | (92,044 | ) | (28,639 | ) | |||||||
Net income (loss) for the period | 7,275 | 19,370 | 12,095 | 1,718 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table A6
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Consolidated statements of changes in financial position
As of June 30, | |||||||||||||||
2005 | 2006 | Change | 2006 | ||||||||||||
(Ps. mm) | (US$mm) | ||||||||||||||
Operating activities | |||||||||||||||
Net income (loss) | 7,275 | 19,370 | 166 | % | 12,095 | 1,718 | |||||||||
Charges to operations not requiring the use of funds: | 53,891 | 64,210 | 19 | % | 10,319 | 5,696 | |||||||||
Depreciation and amortization | 24,830 | 29,642 | 19 | % | 4,812 | 2,630 | |||||||||
Other non-cash flow items | 29,061 | 34,568 | 19 | % | 5,507 | 3,067 | |||||||||
Funds from net income (loss) | 61,166 | 83,580 | 185 | % | 22,414 | 7,415 | |||||||||
Changes in working capital: | 22,874 | (129,083 | ) | (151,957 | ) | (11,451 | ) | ||||||||
Accounts, notes receivable and other | 29,753 | (51,780 | ) | (81,533 | ) | (4,594 | ) | ||||||||
Inventories | (8,166 | ) | (10,796 | ) | 32 | % | (2,630 | ) | (958 | ) | |||||
Intangible asset derived from actuarial computation of labor obligations and other assets | 4,206 | (8,294 | ) | (12,501 | ) | (736 | ) | ||||||||
Suppliers | (4,554 | ) | (3,167 | ) | 30 | % | 1,386 | (281 | ) | ||||||
Other liabilities | 1,635 | (55,045 | ) | (56,680 | ) | (4,883 | ) | ||||||||
Funds provided (used) by operating activities | 84,040 | (45,503 | ) | 154 | % | (129,543 | ) | (4,037 | ) | ||||||
Financing activities | |||||||||||||||
Bank loans | 18,366 | 37,094 | 102 | % | 18,729 | 3,291 | |||||||||
Securities | 131,368 | 30,600 | -77 | % | (100,769 | ) | 2,715 | ||||||||
Other financing | (26,660 | ) | 29,083 | 55,743 | 2,580 | ||||||||||
Amortization of bank loans | (35,826 | ) | (19,780 | ) | 16,046 | (1,755 | ) | ||||||||
Amortization of securities | (47,251 | ) | (2,031 | ) | 45,220 | (180 | ) | ||||||||
Amortization of other financing | (35,183 | ) | — | 35,183 | — | ||||||||||
Minimum guaranteed dividends paid to the Mexican | (10,728 | ) | (15,283 | ) | (4,555 | ) | (1,356 | ) | |||||||
Other equity movements | (4,727 | ) | 8,400 | 13,128 | 745 | ||||||||||
Funds provided (used) by financing activities | (10,641 | ) | 68,084 | -740 | % | 78,725 | 6,040 | ||||||||
Investing activities | |||||||||||||||
Acquisition of property, plants and equipment | (38,253 | ) | (46,401 | ) | (8,148 | ) | (4,116 | ) | |||||||
Funds provided (used) by investing activities | (38,253 | ) | (46,401 | ) | 21 | % | (8,148 | ) | (4,116 | ) | |||||
Net increase in cash and cash equivalents | 35,146 | (23,820 | ) | (58,966 | ) | (2,113 | ) | ||||||||
Cash and cash equivalents at the beginning of the year | 88,277 | 121,620 | 38 | % | 33,343 | 10,789 | |||||||||
Cash and cash equivalents at the end of the year | 123,423 | 97,801 | -21 | % | (25,623 | ) | 8,676 | ||||||||
Funds provided (used) by operating activities | 84,040 | (45,503 | ) | (129,543 | ) | (4,037 | ) | ||||||||
Funds provided (used) by investing activities | (38,253 | ) | (46,401 | ) | (8,148 | ) | (4,116 | ) | |||||||
Free cash-flow | 45,787 | (91,904 | ) | (137,691 | ) | (8,153 | ) |
* | Derived from unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
Free cashflow and discretionary free cashflow are non Mexican GAAP measures and are reconciled to Mexican GAAP as set forth above.
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Table A7
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Total sales, net income (loss) and total assets by segment
Figures in millions of constant pesos as of June 31, 2006
Exploration and Production | Refining(1) | Gas and Basic Petrochemicals | Petrochemicals | Subsidiary Companies and Corporate | Intersegment Eliminations | Total | ||||||||||||
Six months ending June 30, 2006 | ||||||||||||||||||
Total sales | 423,305 | 209,145 | 106,048 | 13,427 | 340,037 | (569,191 | ) | 522,770 | ||||||||||
External clients | — | 187,719 | 65,500 | 9,430 | 327,900 | (67,778 | ) | 522,770 | ||||||||||
Intersegment | 423,305 | 21,425 | 40,549 | 3,997 | 12,137 | (501,413 | ) | — | ||||||||||
Operating income (loss) | 337,189 | (35,056 | ) | 6,452 | (7,054 | ) | (3,287 | ) | 6,983 | 305,227 | ||||||||
Net income (loss) | 31,531 | (18,864 | ) | 5,765 | (9,011 | ) | 26,913 | (16,965 | ) | 19,370 | ||||||||
As of June 30, 2006 | ||||||||||||||||||
Assets | 904,310 | 358,003 | 116,918 | 115,949 | 1,744,933 | (2,125,941 | ) | 1,114,173 | ||||||||||
Six months ending June 30, 2005 | ||||||||||||||||||
Total sales | 320,817 | 171,632 | 95,903 | 14,613 | 229,989 | (402,318 | ) | 430,636 | ||||||||||
External clients | — | 153,845 | 60,871 | 9,926 | 190,043 | 15,950 | 430,636 | |||||||||||
Intersegment | 320,817 | 17,787 | 35,032 | 4,686 | 39,946 | (418,268 | ) | — | ||||||||||
Operating income (loss) | 243,541 | 8,678 | 5,633 | (3,295 | ) | (7,760 | ) | 8,120 | 254,916 | |||||||||
Net income (loss) | 6,688 | (3,534 | ) | 7,526 | (4,855 | ) | 11,780 | (10,329 | ) | 7,275 | ||||||||
As of June 30, 2005 | ||||||||||||||||||
Total assets | 695,643 | 292,510 | 104,996 | 50,033 | 1,357,565 | (1,482,208 | ) | 1,018,539 |
* | Unaudited consolidated financial statements prepared in accordance with Mexican Generally Accepted Accounting Principles (Mexican GAAP) issued by the Instituto Mexicano de Contadores Públicos. Inflation recognition is also in accordance with Mexican GAAP. Accordingly, peso figures are presented in constant Mexican pesos as of June 30, 2006. |
(1) | External clients sales of Refining are net of IEPS. |
Note: Numbers may not total due to rounding.
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PEMEX | Investor Relations |
Cash payment of taxes | The total cash payment of taxes and duties during the second quarter of 2006 increased 72%. This was mainly because the cash payment of the hydrocarbons duties increased Ps. 111.5 billion, or 86%, compared to the second quarter of 2005.
The cash payment of the Special Tax on Production and Services (IEPS) decreased Ps. 2.1 billion. |
Table A8
Petróleos Mexicanos, Subsidiary Entities and Subsidiary Companies
Cash payment of taxes (nominal figures)
Second quarter (Apr. - June) | Six months ending June 30, | |||||||||||||||||||||||||||
2005 | 2006 | Change | 2006 | 2005 | 2006 | Change | 2006 | |||||||||||||||||||||
(Ps. mm) | (US$mm) | (Ps. mm) | (US$mm) | |||||||||||||||||||||||||
Total taxes and duties | 142,168 | 245,017 | 72 | % | 102,849 | 21,736 | 273,376 | 397,218 | 45 | % | 123,842 | 35,238 | ||||||||||||||||
Hydrocarbon duties and other | 128,921 | 240,404 | 86 | % | 111,483 | 21,327 | 252,089 | 397,497 | 58 | % | 145,409 | 35,263 | ||||||||||||||||
Excess gains duty | 8,221 | 1,689 | -79 | % | (6,532 | ) | 150 | 7,199 | 1,740 | -76 | % | (5,458 | ) | 154 | ||||||||||||||
Special Tax on Production and Services (IEPS) | 5,026 | 2,924 | -42 | % | (2,102 | ) | 259 | 14,089 | (2,020 | ) | (16,108 | ) | (179 | ) |
Note: Numbers may not total due to rounding.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 37/38 |
PEMEX | Investor Relations |
If you need to contact Investor Relations or to be included in the distribution list, please call or send an e-mail to:
Telephone: | (52 55) 1944 9700 |
Voice | mail: (52 55) 1944 2500 ext. 59412 |
ri@dcf.pemex.com
Celina Torres | Rolando Galindo | |
ctorresu@dcf.pemex.com | rgalindog@dcf.pemex.com | |
Rebeca González | Armando Acosta | |
rgonzalez@dcf.pemex.com | aacosta@dcf.pemex.com | |
Elizabeth Osman | Paulina Nieto | |
eosman@dcf.pemex.com | pnietob@dcf.pemex.com |
PEMEX is Mexico’s national oil and gas company. Created in 1938, it is the exclusive producer of Mexico’s oil and gas resources. The operating subsidiary entities are Pemex Exploration and Production, Pemex Refining, Pemex Gas and Basic Petrochemicals and Pemex Petrochemicals. The principal subsidiary company is PMI, its international trading arm.
Amounts in US dollars are translated at the June 30, 2006 exchange rate of Ps. 11.2723 per US dollar.
This report contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward looking-statements. These are good faith statements based on current plans, estimates and projections and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties. These risks and uncertainties include crude oil price volatility; production, equipment, and transportation risks inherent in the oil industry; environmental regulations in Mexico; actions of the Mexican government with respect to our operations, budget, taxation, commercial activities, control of hydrocarbon reserves, or debt service payments; any limitations on exports resulting from agreements of the Mexican government; and economic, political, and foreign exchange risks affecting Mexico. These risks and uncertainties are more fully detailed in PEMEX’s most recent Form 20-F filing with the US Securities and Exchange Commission (www.sec.gov) and the PEMEX Prospectus filed with the National Banking and Securities Commission (CNBV) and available through the Mexican Stock Exchange (www.bmv.com.mx). These factors could cause actual results to differ materially from those contained in any forward-looking statement.
The US Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this document, such as total reserves, probable reserves and possible reserves, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. Investors are urged to consider closely the disclosure in our Form 20-F, “File No. 0-99”, available from us atwww.pemex.com or Marina Nacional 329 Floor 38 Col. Huasteca, Mexico City 11311 or at (52 55) 1944 9700. You can also obtain this Form from the SEC by calling 1-800-SEC-0330.
EBITDA, free cash-flow and discretionary cash-flow are non-GAAP measures, which are calculated as described above. They are presented because PEMEX believes that they are widely accepted financial indicators of its ability to service or incur debt. EBITDA, free cash-flow and discretionary cash-flow should not be considered as indicators of financial performance, as an alternative to cash flow, as a measure of liquidity, or as being comparable to similarly named measures of other companies.
The total debt calculation includes, in addition to documented debt, the items that are usually considered as debt by the financial markets.
PEMEX financial results report as of June 30, 2006 | www.pemex.com | 38/38 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Petróleos Mexicanos | ||
By: | /s/ Mauricio Alazraki Pfeffer | |
Mauricio Alazraki Pfeffer | ||
Associate Managing Director of Finance |
Date: August 8, 2006
FORWARD-LOOKING STATEMENTS
This report may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management’s current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words “anticipates,” “believes,” “estimates,” “expects,” “plans” and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.