The Mexican president let fracking opponents hope for the abolition of the environmentally harmful procedure. Rebecca Bertram explains to what extent this promise has been fulfilled.
Mexico elected its new President last year: since December 1st 2018, Andrés Manuel Lopez Obrador (also known as AMLO) holds the highest office in the country. His victory was seen by many analysts as a radical shift in Mexican politics: away from clientalism to one that favors a more inclusive form of government.
From an environmental perspective, one of his most exciting campaign promises was a ban on fracking, a particularly dirty form of extracting oil and gas from shale rock. Fracking is controversial because it requires large amounts of water and chemicals that contaminate ground water reserves and lead to air pollution that severely affects the public health of the local population.
Fracking in Mexico
Over the past few years, fracking has established itself as an important technique to extract oil and gas in Mexico. Many see it as a way to make the country more energy independent and reduce its dependence on foreign natural gas imports – Mexico currently imports around 80 percent of its overall natural gas needs.
There are estimates that there may be as much as 60 billion barrels of oil equivalent (BBOE) in the Mexican shale, mostly concentrated in the northern part of the country. The technology originally comes from the United States where it has generated a so-called “fracking boom” and turned the country from a gas importer into a gas exporting country.
Pemex, the Mexican national energy company, began shale gas exploration back in 2010 in the northern region of Chihuahua. Here, opposition to the technology has been particularly prominent. The local population and leading local politicians have been mobilizing for a special treatment of desert environments since there is so little ground water readily available.
Can AMLO really stop fracking?
President AMLO’s anti-fracking announcement is the result of a hard fought fight by social society and local communities around the country. However, as Claudia Campero from Food and Water Watch tells me, this is still far from where we need to be. The president alone cannot change the country’s fracking policy: legislative and regulatory backing are needed to effectively stop fracking in Mexico.
The Mexican Alliance against Fracking, the group that has been at the forefront of Mexico’s fight against fracking says that what is really needed – besides the simple declaration by the president – is a ban of the technique in the Mexican legislative framework at the federal level. Why is this important? Because current legislation still allows fracking to happen and regulates the practice through a set of guidelines.
Another indication that President AMLO’s word is not enough is the Mexican Congress. It has seen four different anti-fracking legislations be brought forward over the last few years, but has failed to seriously discuss any of these initiatives. It has even gone so far as to approve a budget for the year 2019 which foresees more than 6.5 billion pesos – equivalent to about 345 million USD – to PEMEX, the national oil and gas company to engage in fracking activity throughout the country.
In addition, the Mexican Energy Ministry has announced that it is looking into ways in which fracking can be made more environmentally friendly. So Mexican policy making is appearing to be more interested in maintaining the practice of fracking, although acknowledging that its impact on the local environment may be harmful.
Energy auctions: a tool to stop fracking?
However, AMLO has one tool at his disposal: he announced in December 2018 that he would suspend all further energy auctions for three years. This means that no more permits to exploit shale gas can be sold.
Energy auctions had been in place in Mexico since 2013 when the former government opened the country’s energy industry up to private investment and foreign companies. AMLO’s decision to suspend these auctions is significant because the Auction Round 3.3, originally scheduled for February 2019, would have seen the first shale auction in the country.
This could indeed signify an important step if it weren’t for the other auctions that were suspended as well. As Claudia Campero points out “this move could be more of a new strategy which the government is adopting towards private investors.”
So to sum it up, yes, some important first steps have been taken by the new Mexican president AMLO to ban fracking. However, as with so many other policy areas, it is insufficient without a clear legislative and regulatory decision matching it. Without it, the topic does not carry the necessary political weight and could easily be hijacked by political mood swings. Yet perhaps the biggest question is what to do with companies that already have fracking permits. I don’t have an answer to that.