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Covid-19 makes harder to revive AMLO's home state mired by contagion

Alejandro Cegarra/Bloomberg

The site of the controversial Petroleos Mexicanos Dos Bocas refinery in Paraiso, Tabasco state, Mexico in 2019.

- Tabasco, where president is from, sees surge in virus outbreak
- Oil platform workers in transit are adding to spread of virus

By Lorena Rios, Amy Stillman/Bloomberg

Petroleumworld 06 17 2020

Mexican President Andres Manuel Lopez Obrador pledged to bring prosperity to his home state in the country's poor southeast by reviving its oil industry. The high prevalence of Covid-19 there may be one unintended consequence.

Tabasco now has the second-highest rate of active Covid-19 cases per 100,000 inhabitants, just behind Mexico City, according to government data. Oil workers who were infected offshore before traveling through Tabasco on their way back home have helped the virus to spread, state Governor Adan Augusto Lopez said Monday.

“We are a state that is a pathway to the peninsula,” Lopez said in an interview, in a reference to the Yucatan Peninsula. “A lot of movement contributed to these rates.”

Pablo Lopez Figueroa, a Pemex employee and representative of the National Union of Petroleum Technicians and Professionals, said that the prevalence of Covid-19 on oil platforms off the coast of the neighboring state of Campeche is contributing to the contagion. “A high number of offshore workers are spreading the virus in Tabasco because they live here or pass through here to get to the interior of the country,” he said, speaking on the phone from Paraiso.

The number of cases in Tabasco soared 65% in the two weeks ending June 8, though the pace has since slowed. Lopez said more testing is helping to control the spread of the virus, but it could also be contributing to the rise in the number of known cases.

Petroleos Mexicanos, as the national crude producer is also known, expanded testing in southern oil states amid a climbing death toll. Pemex reported that 125 employees and four contract workers died from the virus as of Monday evening.

Tabasco has the highest number of onshore oil wells in Mexico and is home to the country's main crude export port, Dos Bocas.

Under the presidency of Lopez Obrador, often dubbed AMLO, Pemex moved its exploration and production headquarters to Villahermosa, the capital of Tabasco. Pemex is also pressing ahead with work on an $8 billion oil refinery project in the state to meet the president's goal of Mexican energy self-sufficiency.

Pemex performed almost 3,000 tests and is doing more to sanitize offshore facilities, provide workers with protective equipment and suspend non-essential activities, the company said in a statement on June 10.

Dr. Francisco Olan, an internist at Hospital General de Zona No. 2 in the city of Cardenas, said the population in Tabasco is also partly to blame for not taking precautions such as using masks and social distancing.

“Cases have risen in Tabasco because people are not used to staying at home and are opting for going out,” he said, noting that the easing of restrictive measures means cases will continue to rise in June.

Lopez Obrador swept into power with the help of impoverished oil towns like Tabasco, where more than half of the population lives below the poverty line. He promised to revitalize the oil sector by ending Pemex's 15 years of crude output declines and generating jobs with the refinery construction.

Credit ratings agencies have questioned the strategy. Pemex is struggling under the highest debt of any major oil company and saw a record loss of $23 billion in the first quarter of the year. Its bonds have been downgraded to junk by Moody's Investors Service and Fitch Ratings Inc.

Lopez Obrador has been criticized for easing the lockdown too soon, and not enforcing restrictive health measures, including failing to follow safety protocols himself.

“There's many who don't want to go out but we have to go out little by little, carefully,” he said at a press conference last Thursday. He traveled to six southern states last week including Tabasco, where he visited the Dos Bocas project.

Willian Hernandez, who works in the oil sector in Tabasco, blames both the president and his fellow citizens of the state for the rapid spread of the virus.

“AMLO has been a bad example with poor management of this health emergency, and it must also be said, those from Tabasco are very reluctant to follow directions,” he said.

Story by Lorena Rios, Amy Stillman from Bloomberg News.
06 16 2020



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