Mexican President Andrés Manuel López Obrador, left, at the inauguration of the first construction stage of the Dos Bocas Refinery on Friday, July 1. Photo: Presidencia

By KELIN DILLON

Several days after Mexican President Andrés Manuel López Obrador (AMLO) inaugurated the controversial Dos Bocas Refinery on Friday, July 1, Mexican journalist Carlos Loret de Mola released a scathing two-part analysis of purported lies featured in López Obrador’s inaugural address, revealing apparent inconsistencies in AMLO’s contentious Tabascan pet project.

According to Loret de Mola – a perennial opponent of AMLO in the press, and a regular fixture in López Obrador’s constant rants against Mexican journalists – López Obrador characterized Friday’s event as the “inauguration of the first construction stage” of Dos Bocas, despite this term not existing in the lexicon of traditional construction project management, alleging that AMLO invented the term in order to avoid admitting the project is not yet complete.

Loret de Mola went on to point out that not a single barrel of oil was seen leaving the refinery, and despite AMLO’s claims that Dos Bocas will be fully functional come December 2022, oil sector specialists predict the refinery will not be capable of processing its first barrels of oil until 2026, some four years after the López Obrador administration’s predictions.

“The president stated that Mexico will soon refine 1.2 million barrels of oil, adding another 340,000 barrels from Dos Bocas, an additional 340,000 barrels from Deer Park, and more barrels from two other plants,” said Loret de Mola. “That is 2 million barrels. It’s impossible to refine oil you don’t have: Mexico is only producing 1.7 million barrels of crude. And that doesn’t go up overnight.”

AMLO’s own claims were refuted during the inauguration by state-owned oil company Petróleos Mexicanos (Pemex) general director, whose own numbers did not match up with López Obrador’s apparent data.

“If 340,000 barrels are processed in the United States, this means that only 760,000 barrels are processed in Mexico, not the 850,000 that the president claimed,” said Loret de Mola. “And 90,000 barrels of difference is a lot. It is a figure that moves the markets. This government does not even coordinate in having the same figures in the speeches.”

López Obrador likewise used the inauguration to discuss how Mexico’s oil prices are significantly lower than the United States, while failing to mention the 22 billion pesos in monthly subsidies the Mexican government gives to nationally-produced oil manufacturer Petróleos Mexicanos (Pemex), subsidies which Loret de Mola said could cause major budgetary issues later on if current global market conditions persist.

In his secondary analysis, Loret de Mola went on to criticize the Mexican government’s investment in the Texas-based Deer Park refinery, revealing that while Mexico bought the rights to the other half of the refinery from oil giant Shell for $500 million, it also absorbed the refinery’s $1 billion in debt. While AMLO claimed at the time of purchase that Deer Park would recuperate 50 percent of its investment within its first six months of operation, the refinery only produced $200 million in goods in that time period – a far-cry from $1.5 billion.

Loret de Mola then pointed out how the Mexican government has touted Dos Bocas as a great investment for the Mexican economy. However, the under-constructed refinery costs a whopping $12 billion at the moment, far more than Deer Park’s $1.5 billion, despite both refineries having the same capacity to produce 340,000 barrels of oil.

This contributes to one of Loret de Mola’s most intense criticisms of the Dos Bocas refinery: its cost. While Secretary of Energy Rocío Nahle said during the inauguration speech that the new refinery cost $10.2 billion — directly contradicting AMLO’s own $12 billion figure, a number already $4 billion higher than his initial estimate –- she did not clarify if this figure was just for the costs ahead of the “inauguration of the first construction stage” or the total price tag. 

Considering the refinery is not set to refine any oil until 2026, there’s likely to be numerous additional costs to the price tag, which experts predict could be up to $18 billion by its completion. But given the fact that Dos Bocas’ contracts are not made publicly available, it’s difficult to ascertain the true cost of the refinery at the moment, especially considering the government’s self-contradictory figures.