MEXICO CITY (AP) — Mexico's state-run electric company is looking to renegotiate generous natural gas contracts it has with private sector firms that stipulate payments even when gas isn't being delivered.
Federal Electricity Commission director Manuel Bartlett said Monday the company runs the risk of bankruptcy if it doesn't reach new terms with the companies. He said that since 2015, it has paid private sector companies 62 billion pesos ($3.2 billion) under contracts for gas delivered via pipeline to generate electricity, even when the gas isn't flowing. Several projects have been blocked by community protesters.
President Andres Manuel Lopez Obrador expressed optimism that the contracts could be revised voluntarily, while lambasting their existence in the first place. Several of the companies involved have ties with former government officials in Mexico.