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AMLO says new Gas Bienestar will be controlled by Pemex

Mexico City, Mexico — Gas Bienestar, a new LP company announced by the president, will be controlled by state-owned Pemex. Gas Bienestar is slated to begin operations in October.

The president says that the five private companies that sell LP fuel now will not be run out the market since Gas Bienestar will only act as a competitor, adding that it will be a company of the people.

The Government of Mexico has set a period of three months for Gas Bienestar to begin the distribution of cylinders around Mexico City, announced President Andrés Manuel López Obrador.

“After the announcement, I spoke with the director of Pemex. They are already working on that. We have the resources. There is no problem. We also have the gas because Pemex has gas and also imports gas. We have the raw material. We can, if it is necessary, to import more gas and we have the budget,” he said in a morning conference.

López Obrador said that Pemex sells a kilogram of LP gas to gas companies at 13.50 pesos, while they sell it to the end user at 20.94 pesos. This situation, he said, is leaving him a demagogue and a liar, since he promised that fuels would not increase in cost.

In a morning press conference, he assured that with this determination “gas will not increase beyond inflation after we take these measures. The increase stops,” he said adding that the profit margin will be minimal. It will be used to cover operating costs such as the acquisition of special vehicles and the adaptation of the infrastructure at Pemex charging stations.

He reported that in three months, the Gas Bienestar company could be put into operation, which will be managed by Petróleos Mexicanos.

The president added that current companies will continue to participate in the market and that the addition of Gas Bienestar will guarantee real competition.

“We are not going to take away the right of distributors to sell gas, but there will be more right to control the price,” he said.

He explained that there are currently five large companies that distribute almost 50 percent of the LP gas and obtain high profit margins.

“Pemex sells at a price and they sell to the consumer a very high price. (…) These large distributors in turn have control over the territories through a kind of subcontracting, which are the ones that handle everything that has to do with the sale of gas and they don’t even allow there to be competition, they control the territories,” he pointed out.

AMLO said that this issue has a greater incidence in Mexico City, which is why Gas Bienestar will start operations there.

“For the humble people, the poor people of the colonias, what hurts the most is when the price of gas in the cylinder increases. (…) We are attentive and we are going to act to control unjustified increases in some supplies and food that affect the popular economy,” he emphasized.