Mexican oil workers fear Pemex proposal

August 13, 2013

Along the beachfront of the most important oil town in Mexico, there are fancy restaurants, discos, gated homes and other signs of the largess enjoyed by the many domestic and foreign firms that for years have contracted with this country’s state-run oil giant, Pemex.

But for the Mexicans flocking here by the thousands to work for those contractors as non­union welders, pipe fitters, industrial divers and even toilet cleaners, there are other landmarks that speak to the bleak future they fear as President Enrique Peña Nieto seeks historic changes to expand private and foreign investment in the world’s eighth-largest oil company.

Stops on this tour include the “Plaza of Wailing,” where workers gather to complain about low wages and corrupt bosses; the Last Resort restaurant, where they can eat a meal on credit when they aren’t paid on time; and Bocho, one of the $5-a-night bunk-bed hotels where they sleep before shipping out to the oil platforms that drill in Mexico’s biggest oil fields.

While government officials promise that new jobs and other opportunities will arise from opening up Pemex to foreign investors, workers here said they are already experiencing a kind of privatization that the state-run oil monopoly has been engaged in for decades — awarding contracts to companies that hire workers as cheaply as possible to service the platforms spread across the massive oil fields off this gulf-coast island city.

“It’s all to the benefit of the big businessmen,” said Carlos, a welder from nearby Veracruz state who gave only his first name, fearing he would be fired for speaking frankly about the contracting practices he believes will only continue with Peña Nieto’s proposals. “The rich will get richer, and the poor will be poorer.”

This reading — repeated in less delicate terms by dozens of workers interviewed here — speaks to the considerable political obstacles Peña Nieto’s young government faces as it attempts to sell his ideas to a deeply cynical Mexican public, which sees Pemex as awash in corruption destined to undermine even the most ­well-intentioned reforms.

The workers’ views also speak to the complicated feelings many Mexicans have as their government embarks on one of the most potentially significant changes to the energy sector in recent history. Mexicans have felt deeply nationalistic about oil since 1938, when President Lázaro Cárdenas kicked out foreign oil companies. But about 80 percent of Mexicans now associate Pemex with corruption, according to a recent poll, and do not believe that Peña Nieto’s plans will do much beyond creating more rich elites.

“They sold our electricity, our gold, and now they want to sell our oil,” said Luis Raul Parada Alejandre, 72, whose grandparents gave their cows, lambs and horses in 1938 to help pay off the debt to foreign oil companies and who planned to attend a rally against the proposed measures. “It’s going to impoverish us even further — it’s just logic.”

For decades, Pemex has exploited relatively easy-to-drill, shallow water fields such as Cantarell off the coast of this city, and oil revenue constitutes 30 percent of the federal budget. Pemex union bosses have gotten rich presiding over a system of “paying jobs” — which workers pay to get.

Pemex has also contracted with politically connected firms such as Oceanografía, whose investors are widely reported to include the stepsons of former Mexican president Vicente Fox — leading many Mexicans to see Pemex as a slush fund for their nation’s elite.

But with shallow-water fields drying up and production down by about 25 percent over the past decade, government officials say changes are necessary to lure global oil giants such as Exxon Mobil and Brazil’s Petrobras that have the technical expertise and money to explore and drill in deep-water and shale fields that are more difficult to access.

In an address Monday, Peña Nieto proposed changing the constitution to allow companies to form profit- and risk-sharing partnerships with Pemex, arrangements that are currently illegal. Speaking broadly, he said that this proposal and other measures were necessary to “ensure Mexico’s future” and that Mexican families would ultimately benefit from cheaper gas and electricity and thousands of new jobs.

‘Nothing you can do’

The micro view from the city’s Plaza of Wailing looks different.

Workers rolling battered suitcases across the stone toward the docks and on to 14-day shifts on the platforms described the harsh realities of working for private contractors, conditions they expect will only proliferate if Peña Nieto’s changes go through.

“Imagine — I’m going to the platform tonight at 3 a.m., and I have not been paid my salary in two months,” said an industrial diver named Antonio, 44, who did not give his last name because he feared that the company he works for, Oceanografía, would fire him. “And there are thousands like me. . . . Do you know how much money the owner can make playing with our salary for two months?”

Many workers point out that the company’s owner, Amado Yañez, has spent millions on four professional soccer teams and is building a statue of the Virgin of Carmen — at a cost of $2.5 million, according to the mayor — off the coast of the island.

Recently, workers became so frustrated that they chained themselves to the company’s offices in town and half-joked about setting themselves on fire so they might be paid. Calls to Oceanografía were not returned.

“There’s really nothing you can do,” Antonio said. “If you try to do something, they fire you.”

He sat on a bench in the cool evening with his friend Luis Dartola, 58, another industrial diver who had come to Ciudad del Carmen to try to collect his salary, too. Dartola said that when he recently went to the social security office, he found that the contractor he worked for had apparently underreported his wages for years, meaning the company paid less in federal taxes and he would receive less in benefits.

Both men described being asked by their manager to sign blank pieces of paper without telling them what they were for. They and others described elaborate systems of subcontracting and sub-subcontracting in which they would work for one company, only to receive paychecks from other entities the companies set up.

“Really, the reform should work how they talk about it, but all those things they promise, they won’t reach here,” Antonio said. “. . . New companies will come, but we’ll have the same problems.”

The oil town

Ciudad del Carmen is a city that boomed after a fisherman discovered the Cantarell field, a feat for which he earned a medal before dying “poor and humble,” according to his grandnephew, Daniel Cantarell, a doctor in town.

The city now has 220,000 people, with a transient population of about 30,000 who come from all over to work in the oil business.

Those who have union jobs with Pemex live in middle-class enclaves and head to work in the sprawling office buildings in the middle of town. Pemex engineers and contractors who come from the United States, Colombia, Venezuela, Norway and other countries lodge in four-star hotels, dine at beachfront restaurants and swoop out to the platforms in helicopters.

Those who work for contracting companies or hope to get hired by them arrive packed in rented trucks or buses that drop them off with their safety-orange uniforms along the narrow streets of the city. Food and shelter until their jobs start are often not included in their pay, so they try to live cheap.

Workers who make between $300 and $800 a month might spend $5 a night in a slanting, barb-wired bunk-bed hotel such as Capricornio or Bocho. They wait in the plaza for work or eat a cheap bowl of pozole at the Last Resort, started by a laid-off oil worker who extends credit.

Other pastimes include standing in the long morning line at the federal agency in charge of resolving labor disputes, where workers crowd every day to file complaints that often take years to resolve.

“I have had a complaint for three years,” said a welder named Eduardo, 40, who said his contractor owes him about $1,000. “Nothing happens.”

He was standing in the plaza with a dozen or so others who were between jobs. “The future looks uncertain because this reform is a reform to benefit the big companies,” said Jose Hernandez, 49, who has worked for at least five contractors over the years. “For workers, there will be no real benefit. This is why guerrilla movements are formed. We are tired of so much manipulation.”

Miguel Juarez Lugo contributed to this report.

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