Mexico’s Petroleos Mexicanos (Pemex) continues to accumulate millions of dollars in late payments to oil companies as it struggles to produce cash with its mounting debt levels and weak crude sales. As of last month, Pemex owes around $60mn to Egypt’s Cheiron Petroleum Corp. and about $4mn to Hokchin Energy, a subsidiary of Argentina’s Pan American Energy LLC, as well as undisclosed amounts to Wintershall Dea GmbH. Pemex has been burning cash each year since over a decade with negative free cash flows each year since 2007. It burned through $8.9bn in 2020 and $7bn in 2019. Pemex’s debt has reached $113.9bn and the company reported $15.6bn in adjusted revenue in the first quarter of this year. Pemex’s bonds are rising as the oil-market recovers and crude prices climb. 
“This is certainly very concerning because such payment delays will eventually have a negative impact in both the partnerships and in oil investment and production,” said Rice University’s Monaldi. Moody’s Investors Service Inc. said that the majority of Pemex’s pre-tax cash flow is consumed by taxes and duties, and debt had to be funded by its capital spending, which limited its reinvestment capacity in production and reserves.
Pemex´s dollar 6.875 2025s are trading at 110.86, yielding 4.12% currently.
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