Our staff remains at the forefront of the evolution of regulations that affect our clients’ businesses.
New Regulatory Framework for the hydrocarbons sector.
On October 3rd, the Regulation to the new Hydrocarbons Sector Law (the “New Hydrocarbons Law”) was published in the Federal Official Gazette.
The new Regulation to the New Hydrocarbons Law (the “Regulation”) substitutes the Regulation of the Hydrocarbons Laws of 2014, as well as the Regulation on the Activities referred to in Title Three of the previous law, introducing structural and operational changes that directly impact regulated activities in the hydrocarbons sector and seek to update, simplify, and strengthen the mechanisms for supervision, control, and monitoring.
Among the most significant changes is the creation of the National Energy Commission (“CNE” per its Spanish acronym), which will assume the powers of the Energy Regulatory Commission (“CRE” per its Spanish acronym) and the National Hydrocarbons Commission (“CNH” per its Spanish acronym). However, the current general administrative provisions, the Mexican official standards, and other regulations issued by the Ministry of Energy (“SENER” per its Spanish acronym), as well as the CRE and CNH, will remain in force until new provisions are issued to replace them.
In matters of industrial safety and environmental protection, coordination between the Safety, Energy, and Environment Agency and the CNE is strengthened. Although the agency retains its inspection powers, technical reports must be validated by the CNE prior to the imposition of sanctions or suspensions. In addition, the Incident and Accident Information System and the Electronic Information Platform are created.
Regarding the contractual regime for hydrocarbons exploration and production, the New Hydrocarbons Law includes provisions for both wholly state-owned and mixed development assignments. SENER may grant participation contracts (profit-sharing, production-sharing, or license contracts) through public bidding processes when Pemex lacks the capacity or interest to undertake specific projects; meanwhile, direct assignments will only be allowed on an exceptional basis, subject to prior technical and economic justification before SENER and the CNE.
As for the midstream and downstream segments, permits or authorizations to carry out activities related to both segments will be granted by SENER and the CNE, depending on the nature of the activity.
The new Regulation provides the rules for tariff setting and pricing across all regulated activities, which will be determined by the CNE. The Regulation eliminates extensions or renewals of permits, so holders must apply for new ones upon expiration. To this end, renewal applications may be submitted up to one year before the permit’s expiry date.
A Social Impact Statement is introduced as a mandatory requirement for permits or assignments with territorial or social implications, replacing the previous assessment mechanism. Its evaluation will be carried out by SENER and will include prior consultation processes with communities and vulnerable groups, and as of January 1st, 2026, the CNE will assume responsibility for verifying NOM-016-CRE-2016, relating to the quality of petroleum products.
Finally, the transitional provisions foresee an orderly transition. Current holders must reissue or migrate their permits in accordance with the new guidelines, update their information with the competent authority, and align their operational plans with the new regulatory framework.
Therefore, the New Hydrocarbons Law and its Regulation redefine the institutional and operational framework of Mexico’s hydrocarbons sector. It is therefore essential to review the applicable regulations for each activity or project to ensure a smooth transition to the new regime.
If you have any questions or concerns regarding this newsletter, please contact:
Fernanda Rubio | fra@cmgdlaw.com
Gerardo Ranero Puig | grp@cmgdlaw.com
