{"id":4140,"date":"2021-07-13T15:02:27","date_gmt":"2021-07-13T21:02:27","guid":{"rendered":"http:\/\/accesstomexico.mx\/blog\/?p=4140"},"modified":"2021-07-15T15:08:19","modified_gmt":"2021-07-15T21:08:19","slug":"firm-welcomes-state-gas-company-says-it-will-break-monopoly-in-baja-california","status":"publish","type":"post","link":"https:\/\/accesstomexico.mx\/blog\/firm-welcomes-state-gas-company-says-it-will-break-monopoly-in-baja-california\/","title":{"rendered":"Firm welcomes state gas company, says it will break monopoly in Baja California."},"content":{"rendered":"\n
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MEXICO NEWS DAILY<\/strong><\/a><\/p>\n\n\n\n

The owner of a Sonora-based gas company has thrown his support behind the federal government\u2019s plan to create a new state-owned LP gas distribution company, saying it will help lower prices and break a monopoly in Baja California.<\/p>\n\n\n\n

President L\u00f3pez Obrador announced last week that the state oil company Pemex would establish the new utility within three months. Gas Bienestar (Well-Being Gas), as the new company will be called, is needed to create additional competition in the LP gas market because it is dominated by five large companies and gas prices have been rising \u201cunjustifiably\u201d above inflation, he said last Wednesday.<\/p>\n\n\n\n

Jorge Alberto El\u00edas Retes, owner and president of Blue Propane, said he approved of the president\u2019s proposal, saying the entry of the new company into the market will help drive LP gas prices down in cities across Mexico.<\/p>\n\n\n\n

He also said Gas Bienestar\u2019s arrival in Baja California will put an end to an effective monopoly in the northern border state.<\/p>\n\n\n\n

Companies owned by members of the Zaragoza Fuentes family have long controlled the gas market in the state, El\u00edas said, adding that the family has created new firms in order to give the impression there is competition when in fact there is not.<\/p>\n\n\n\n

\u201cFor more than 20 years in Baja California, 12 members of the Zaragoza Fuentes family have controlled 58 permits for the storage, sale, distribution and transport of liquefied petroleum gas,\u201d he said, adding that federal and state authorities have failed to \u201csanction them for the control they maintain over the market.\u201d<\/p>\n\n\n\n

Putting an end to such monopolies is urgent because they affect the nation\u2019s poorest families the most, El\u00edas said.<\/p>\n\n\n\n

\u201c\u2026 LP gas monsters across the country and particularly in Baja California have distorted the market to benefit themselves at the expense of the most humble families,\u201d he said.<\/p>\n\n\n\n

Grupo Tomza, owned by the Zaragoza family, is one of the five large companies L\u00f3pez Obrador was referring to last week, the news website Forbes M\u00e9xico<\/em> reported.<\/p>\n\n\n\n

Blue Propane\u2019s attempt to enter the market in Tijuana \u2013 where gas prices are among the highest in the country \u2013 was stymied by a series of legal impediments that prevented the opening of 10 LP gas distribution points, El\u00edas said.<\/p>\n\n\n\n

\u201c\u2026 We\u2019ve been victims of this gas cartel that has paid off authorities of the three levels of government,\u201d he said, claiming that the Zaragoza family has financed political campaigns in Baja California for decades.<\/p>\n\n\n\n

Lawyers for Blue Propane say that Zaragoza companies have co-opted officials to create a network of institutional support that makes it practically impossible for a new firm to enter the market in Baja California.<\/p>\n\n\n\n

The president of the LP gas industry association Amexgas also said that the creation of a state-owned gas distribution company is a good thing, provided it enters the market on a level playing field.<\/p>\n\n\n\n

Carlos Serrano told the newspaper Milenio<\/em> that Gas Bienestar must compete under the same rules that govern private gas companies and if that is the case its competition is welcome.<\/p>\n\n\n\n

Others have questioned the wisdom of the government\u2019s plan to create a state-owned gas companies, among whom is economic analyst Gabriela Siller. She said last week that the plan was concerning for a range of reasons, including the high cost of creating a new company.<\/p>\n\n\n\n

V\u00edctor Ram\u00edrez, spokesman for the Mexico Climate and Energy Platform, a renewable energy advocacy group, raised concerns about the cost of creating a new company from scratch.<\/p>\n\n\n\n

\u201cI don\u2019t see it being a good strategy, it\u2019s going to be very expensive,\u201d he said in an interview, asserting that buying delivery trucks and purchasing and setting up storage terminals alone will cost about 11 billion pesos (US $548.9 million) at a \u201cvery conservative\u201d estimate.<\/p>\n\n\n\n

Ram\u00edrez also said it\u2019s doubtful that a new company will be ready to enter the market within three months, as L\u00f3pez Obrador claimed would occur.<\/p>\n\n\n\n

\u201cHaving this in three months and having a subsidy to reduce the price of gas is very complicated,\u201d he said, adding that creating Gas Bienestar will cause Pemex\u2019s debt \u2013 already above US $100 billion \u2013 to grow.<\/p>\n\n\n\n

In addition, Ram\u00edrez predicted that the government will end up creating a substandard company.<\/p>\n\n\n\n

\u201c\u2026They won\u2019t achieve something important but what they will achieve is to raise Pemex\u2019s costs,\u201d he said.<\/p>\n\n\n\n

Beatriz Marcelino, head of energy consultancy firm Grupo Ciita, agreed that it is unlikely that the government will have a new company ready to go in three months. Obtaining the necessary permits, provided there are no delays, will take at least eight months, she said.<\/p>\n\n\n\n

\u201cWe doubt that it can be done in three months,\u201d Marcelino said, noting that the Energy Regulatory Commission (CRE) can take more than a year to grant gas distribution plant permits. Environmental impact assessments can take up to six months to complete, she said.<\/p>\n\n\n\n

Serrano said that more than 2,000 permit applications, including ones filed two years ago, are awaiting approval by the CRE.<\/p>\n\n\n\n

Marcelino said the government won\u2019t want to wait for more than a year to obtain the necessary permits to allow Gas Bienestar to begin operations and expressed concern that it could seek favorable treatment from the CRE, whose governing body is conveniently stacked with people hand picked by L\u00f3pez Obrador, a situation that experts warned could cause the regulator to lose autonomy.<\/p>\n\n\n\n

Mexico News Daily Staff. (2021). Firm welcomes state gas company, says it will break monopoly in Baja California. M\u00e9xico. Mexico News Daily<\/em>. Recuperado de <\/strong><\/p>\n\n\n\n

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MEXICO NEWS DAILY The owner of a Sonora-based gas company has thrown his support behind the federal government\u2019s plan to create a new state-owned LP gas distribution company, saying it will help lower prices and break a monopoly in Baja […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-4140","post","type-post","status-publish","format-standard","hentry","category-uncategorized","clearfix"],"_links":{"self":[{"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/posts\/4140","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/comments?post=4140"}],"version-history":[{"count":1,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/posts\/4140\/revisions"}],"predecessor-version":[{"id":4142,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/posts\/4140\/revisions\/4142"}],"wp:attachment":[{"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/media?parent=4140"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/categories?post=4140"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/accesstomexico.mx\/blog\/wp-json\/wp\/v2\/tags?post=4140"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}