Mexican president says $400 mn ready for refinery project

Mexico City, Mar 19 (EFE).- Mexican President Felipe Calderon, said 5 billion pesos ($400 million) are ready to be spent on construction of the new Bicentenary Refinery, which will have the capacity to refine 250,000 barrels annually.

During a ceremony Thursday to mark the 72nd anniversary of the nationalization of Mexico's oil industry, Calderon said state-owned Petroleos Mexicanos has been a key factor in the country's development.

"I'll say it again: Pemex will continue to be crucial to transforming Mexico in the 21st century ... it is and will continue to be a company that belongs to all Mexicans," he said.

On March 18, 1938, President Lazaro Cardenas issued a decree nationalizing the oil companies - most of them U.S.-owned - after they refused to comply with authorities's demands regarding compensation for workers who had been on strike.

Calderon said the government is working to transform Pemex and turn it "once again into the lever for the (country's) future development."

To that end, he said the company has a budget this year of 376 billion pesos ($30 billion), 70 percent of which will be used for investment, "a record high investment total for the company."

This investment, he said, has allowed the company to contain a drop in crude production and keep output stable at 2.6 million barrels per day.

He said the funds poured into Pemex, whose production had been steadily falling due to the exhaustion of its major fields and lack of investment in exploration, will allow it to regain its position as one of the world's leading oil companies.

Regarding the new refinery, the president said the design work and process review had been concluded, including the task of going over all operational scenarios and ensuring the plant's compliance with environmental and industrial security standards.

Calderon said the goal is to avoid the types of errors in calculating construction costs and times that "have occurred in the past and have been expensive, very, very expensive for Pemex and very, very expensive for all Mexicans."

The president added that other investments are being planned, including a major petrochemical complex aimed at reactivating that industry in Mexico.

The complex is to be built this year at an investment cost of $2.5 billion by a consortium that includes Brazil's Braskem as majority partner and Mexico's Idesa with a minority participation.

That amount, Calderon said, "represents more than 60 percent of all investment in petrochemicals during the entire six-year term" of predecessor Vicente Fox, Calderon's National Action Party colleague.

The project, known as Ethylene XXI, involves the production of one million tons per day of ethylene and polyethylenes at three polymerization plans, with operations expected to begin in 2015.

Calderon said the project will create up to 8,000 jobs during the construction phase and as many as 3,000 permanent jobs.