translated from Spanish: Investment of Dos Bocas has a 2% chance of success: IMCO

after making an analysis of the feasibility of the project, the Mexican Institute for competitiveness (IMCO) proposes to the Government of Mexico to cancel the construction of the refinery of Dos Bocas , in tabasco, as the total investment amounting to 160 billion pesos, has only 2% of probability of success.
To reach such a conclusion, the IMCO created a financial model, based on the guidelines established by the Ministry of finance and public credit (SHCP) and studied 30 thousand scenarios through a Monte Carlo simulation.
The result was overwhelming: 98% of the scenarios, the investment in the Dos Bocas refinery project generates more costs than benefits. “I.e., it destroys value for Pemex.”
Read: Two mouths goes this year, says Rocío Nahle, although the study of environmental impact for this possible scenario, is not yet ready IMCO raises the possibility to cancel the project because its realization “can generate a serious crisis of public finances for the whole country (…) as stated by the SHCP, Pemex needs to have a business plan credible and reasonable (…) focused on investments that generate value and not that destroyed”.
According to IMCO the construction of the refinery in Tabasco “has a high probability of being an obstacle to achieve” the objectives of economic growth of Pemex.
In a press release the Institute explains that so-called amending each of the 30 thousand scenarios are: margins of refining, total investment, time of construction and operating expenses.
IMCO stresses that to achieve the projection not considered construction costs of additional infrastructure, such as pipelines and storage facilities, or the refurbishment of the port of Dos Bocas to receive deep draught vessels.
Read: Nahle dismisses corruption in Dos Bocas, although invited to the project companies have been accused of bribes the proposals of the Institute for Andrés Manuel López Obrador’s Government are: explore other options to improve the conditions of supply in the market of gasoline and diesel, as investments in logistics and fuel storage.
Reassigning resources to activities that enhance the Pemex financial viability, such as exploration and production.
Last December, the federal Government announced the intention to build a new refinery in Dos Bocas, Tabasco.
Despite the questions that have been made about the project, the Secretariat of energy, Rocío Nahle, said in interview to political Animal, which Dos Bocas refinery construction will begin this year. This despite the fact that is not yet ready to the environmental impact statement – the main legal requirement for a construction of these characteristics-.
President Lopez Obrador appointed Nahle as the officer responsible for the project, and not the director of Pemex, Octavio Romero. The secretariat estimated that the final cost of the refinery would be between 6 and 8 billion dollars.
Nahle provides that the refinery of Dos Bocas processed crude Maya of 22 degrees API, and will have a processing capacity of 340 thousand barrels per day.
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Original source in Spanish