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Past Catches Up With Mexico's Oil Monopoly

Juan Bueno Torio, chief of Pemex's refinery division, said that under President Vicente Fox, who ended the PRI's 71-year reign with his election in 2000, there has been a dramatic increase in the amount of Pemex revenue reinvested in the company.

Bueno said Pemex had begun a program of pipeline modernization, more than doubling the budget for pipeline maintenance to about $1.3 billion. But he said it is still only about a third of what the company should be spending to ensure the safety of its 32,000-mile pipeline network. "The past has caught up with us," he said.


Elva Garibo Romano, left, sits with her husband and daughter in front of their oil-slicked home. She says her husband, Elias Reyes Rodriguez, has lost his $30 daily wage as a fisherman since the spill and has no other income. (Photos Kevin Sullivan -- The Washington Post)

Bueno said Pemex profits have increased as world oil prices have reached record highs in recent months. Pemex announced sales of nearly $49 billion through first nine months of 2004, putting it on track to significantly surpass the previous year's sales. But even with increasing revenue, he said, it is difficult to balance Pemex's needs with social needs when more than half the population lives in poverty.

Fox has also proposed allowing some private investment in Mexico's energy sector to improve productivity and efficiency, but the PRI-dominated Congress has blocked those efforts, because of strong nationalistic sentiments and a constitutional prohibition on foreign exploitation of Mexican oil and gas.

The subject of Pemex is particularly delicate in Nanchital, where about one-third of the 29,000 inhabitants work for the oil company. Nanchital, 400 miles east of Mexico City in the coastal state of Veracruz, was built as a bedroom community for workers in the vast petrochemical plants here. Pemex dominates this town: The oil workers' union built schools, parks, churches, grocery stores, the town hall and even the funeral home.

But Nanchital's mayor, Francisco Ocejo Meza -- the first person without ties to Pemex or the union to be elected to the post -- said the population has become fed up with Pemex's neglect.

"If they don't immediately start maintaining their equipment adequately, many human lives are at risk, as well as the ecosystem," Ocejo said. "Pemex needs to accept its responsibility right now."

Ocejo said Pemex has responded quickly to the latest spill, bringing in equipment to contain and mop it up, and has hired hundreds of local fishermen to help. He said the company provided medical care for the 800 people sickened by the fumes.

On Christmas Eve, two days after the spill, Pemex officials delivered rotisserie chickens to poor families in 200 waterfront homes. Because of the heavy fumes, people in those houses were prohibited from using electricity or cooking for more than a week. Nanchital's Christmas and New Year's fireworks displays had to be canceled.

The mayor said Pemex's efforts were too little, too late.

Along the river, where volunteers were scrubbing scores of oil-covered pelicans, and dozens of men in yellow and white slickers hauled black mud and debris from the water, Garibo said the future looked grim. She said her husband has lost his $30 daily wage as a fisherman, and her family is running out of money.

"They say no one's going to be able to fish here anymore," she said, sitting on her porch overlooking the oil-stained river. "And we don't have any money. Not even a peso."


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