Facts About Ex-Im Bank Financing Provided to PEMEX
Facts About Ex-Im Bank Financing Provided to PEMEX For the Purchase of U.S. Produced Goods and Services
1. Did your bank loan more than $1 billion to PEMEX in 2009
to support the company's oil drilling in the southern Gulf of Mexico and
is set to loan another $1 billion in 2010?
In Fiscal Year 2009, the Bank approved $1.05 billion in direct loans
and also guaranteed two loans, made by a commercial lender, totaling
$300 million to support the sale of U.S.-produced goods and services.
Another $1 billion in loan guarantees is currently pending Ex-Im Board approval by the end of Fiscal Year 2010 (September 30th).
Before deciding whether to approve applications for financing, Ex-Im
Bank performs rigorous environmental, safety and financial due diligence
activities, including on-site inspections. After financing is approved
the Bank monitors the company's financial, environmental and safety
activities and performs on-site inspections as often as twice a year.
2. Why is Ex-Im Bank giving money to PEMEX when our deficits are so high?
Ex-Im Bank is loaning money to PEMEX, a company with a
flawless record of repaying over $7 billion of loans previously
guaranteed by the Bank. PEMEX has always paid its obligations connected
with Ex-Im Bank financing on-time.
PEMEX uses the proceeds of the Ex-Im Bank financing to buy U.S. goods
and services produced by American workers, which is at the heart of the
Bank's mission to keep American export workers employed.
It's important to note that Ex-Im Bank receives no taxpayer funds from
Congress. The Bank is totally self-sustaining, paying all of its
expenses from the fees and interest that it collects. In fact, since
1992, Ex-Im Bank has given U.S. taxpayers about $5 billion in excess of
the cost of Bank operations.
3. How many projects will the 2010 loans fund and is part of the
agreement to have PEMEX employ U.S. oil contractors and engineers for
both on-shore and off-shore oil production?
By law, Ex-Im Bank financing is directly tied to the export of goods and services produced or provided by American workers.
The 2010 requests will support both on- and off-shore PEMEX activities,
including acquisitions connected with their Cantarell project area, the
Strategic Gas Program (Spanish acronym "PEG"), new projects of PEMEX
Exploration and Production (PEP), a PEMEX subsidiary, for New Pidiregas
Projects (NPP), and a $200 million facility to finance PEMEX's purchases
from U.S. small businesses. None of these projects involve deep water
drilling.
4. Why can't PEMEX get loans from commercial lenders?
Because of the global financial crisis commercially-available loans are
often not readily available, so many foreign buyers are turning to
export credit agencies, of which Ex-Im Bank is one, to provide loans or
loan guarantees. Ex-Im Bank's role is to supplement commercial lenders
when they are unable or unwilling to finance otherwise
commercially-viable transactions.
Without Ex-Im Bank export credit financing, PEMEX might be forced to buy
products or services from competitors in other countries with financing
from their export credit agencies, thereby depriving U.S. companies of
the orders and costing U.S. workers their jobs
5. Did PEMEX as part of the 2009 loan agreement agree to
contract with American firms and purchase equipment from American
manufacturers in exchange for the money?
By law, Ex-Im Bank financing is directly tied to the export of goods and services produced or provided by American workers.
Since 1998, Ex-Im Bank financing for PEMEX's purchases of U.S. goods and
services has helped create or sustain the jobs of over 47,000 American
workers at over 1,300 U.S. companies, including 915 small businesses and
400 large companies.
6. Was PEMEX your largest borrower in 2009?
Yes.
7. Has PEMEX borrowed $8.3 billion from the government since 1998?
No, PEMEX has borrowed $1.05 billion directly from Ex-Im Bank. The Bank
has provided loan guarantees to U.S. and international banks totaling
$7.70 billion for loans they have made to PEMEX.
PEMEX, which has always repaid the loans on time, sought direct lending
from Ex-Im Bank in Fiscal Year 2009 due to the reduced availability of
funds from commercial lenders as a result of the international financial
crisis. This loan supported the purchase of U.S. goods and services.
8. Did one loan worth $600 million finance the development of 18
oil and natural gas fields in the Bay of Campeche in the southern Gulf
of Mexico and another $300 million loan fund the building of oil
production facilities in Mexico's Cantarell offshore oil field?
9. Was the $900 million in loans given to Pemex in April of 2009?
10. Was there another $150 million in loans in May 2009 to support PEMEX's strategic gas program?
Answer to questions 8, 9, 10
In Fiscal Year 2009, Ex-Im Bank approved $1.05 billion in direct loans
and also guaranteed two loans totaling $300 million made by a commercial
lender, to support the sale of U.S.-produced goods and services.
Included in these amounts were a $600 million direct loan for activities
at New Pidiregas Projects (NPP), and $300 million direct loan for
activities at the Cantarell offshore oil field. A $150 million direct
loan was also approved in Fiscal Year 2009 for acquisitions of U.S.
goods and services in connection with PEMEX's Strategic Gas Program
(PEG).
In total, Ex-Im Bank supported a total of $1.35 billion in loans and
loan guarantees to support the sale of U.S. goods and services produced
by American workers in 2009.
11. Why should the taxpayer pay to provide these loans?
Actually taxpayers do not pay anything for either the loans that foreign
buyers receive or the operation of Ex-Im Bank. The companies that
receive Ex-Im Bank financing pay for that financing through the fees
and/or interest that they pay.
The revenue earned by the Bank pays for all of the costs of operating
the Bank. In fact, since 1992, Ex-Im Bank has given U.S. taxpayers
about $5 billion in excess of the cost of Bank operations.
Facts About Ex-Im Bank Financing Provided to PEMEX For the Purchase of U.S. Produced Goods and Services
1. Did your bank loan more than $1 billion to PEMEX in 2009 to support the company's oil drilling in the southern Gulf of Mexico and is set to loan another $1 billion in 2010?
In Fiscal Year 2009, the Bank approved $1.05 billion in direct loans
and also guaranteed two loans, made by a commercial lender, totaling
$300 million to support the sale of U.S.-produced goods and services.
Another $1 billion in loan guarantees is currently pending Ex-Im Board approval by the end of Fiscal Year 2010 (September 30th).
Before deciding whether to approve applications for financing, Ex-Im
Bank performs rigorous environmental, safety and financial due diligence
activities, including on-site inspections. After financing is approved
the Bank monitors the company's financial, environmental and safety
activities and performs on-site inspections as often as twice a year.
2. Why is Ex-Im Bank giving money to PEMEX when our deficits are so high?
Ex-Im Bank is loaning money to PEMEX, a company with a
flawless record of repaying over $7 billion of loans previously
guaranteed by the Bank. PEMEX has always paid its obligations connected
with Ex-Im Bank financing on-time.
PEMEX uses the proceeds of the Ex-Im Bank financing to buy U.S. goods
and services produced by American workers, which is at the heart of the
Bank's mission to keep American export workers employed.
It's important to note that Ex-Im Bank receives no taxpayer funds from
Congress. The Bank is totally self-sustaining, paying all of its
expenses from the fees and interest that it collects. In fact, since
1992, Ex-Im Bank has given U.S. taxpayers about $5 billion in excess of
the cost of Bank operations.
3. How many projects will the 2010 loans fund and is part of the
agreement to have PEMEX employ U.S. oil contractors and engineers for
both on-shore and off-shore oil production?
By law, Ex-Im Bank financing is directly tied to the export of goods and services produced or provided by American workers.
The 2010 requests will support both on- and off-shore PEMEX activities,
including acquisitions connected with their Cantarell project area, the
Strategic Gas Program (Spanish acronym "PEG"), new projects of PEMEX
Exploration and Production (PEP), a PEMEX subsidiary, for New Pidiregas
Projects (NPP), and a $200 million facility to finance PEMEX's purchases
from U.S. small businesses. None of these projects involve deep water
drilling.
4. Why can't PEMEX get loans from commercial lenders?
Because of the global financial crisis commercially-available loans are
often not readily available, so many foreign buyers are turning to
export credit agencies, of which Ex-Im Bank is one, to provide loans or
loan guarantees. Ex-Im Bank's role is to supplement commercial lenders
when they are unable or unwilling to finance otherwise
commercially-viable transactions.
Without Ex-Im Bank export credit financing, PEMEX might be forced to buy
products or services from competitors in other countries with financing
from their export credit agencies, thereby depriving U.S. companies of
the orders and costing U.S. workers their jobs
5. Did PEMEX as part of the 2009 loan agreement agree to
contract with American firms and purchase equipment from American
manufacturers in exchange for the money?
By law, Ex-Im Bank financing is directly tied to the export of goods and services produced or provided by American workers.
Since 1998, Ex-Im Bank financing for PEMEX's purchases of U.S. goods and
services has helped create or sustain the jobs of over 47,000 American
workers at over 1,300 U.S. companies, including 915 small businesses and
400 large companies.
6. Was PEMEX your largest borrower in 2009?
Yes.
7. Has PEMEX borrowed $8.3 billion from the government since 1998?
No, PEMEX has borrowed $1.05 billion directly from Ex-Im Bank. The Bank
has provided loan guarantees to U.S. and international banks totaling
$7.70 billion for loans they have made to PEMEX.
PEMEX, which has always repaid the loans on time, sought direct lending
from Ex-Im Bank in Fiscal Year 2009 due to the reduced availability of
funds from commercial lenders as a result of the international financial
crisis. This loan supported the purchase of U.S. goods and services.
8. Did one loan worth $600 million finance the development of 18
oil and natural gas fields in the Bay of Campeche in the southern Gulf
of Mexico and another $300 million loan fund the building of oil
production facilities in Mexico's Cantarell offshore oil field?
9. Was the $900 million in loans given to Pemex in April of 2009?
10. Was there another $150 million in loans in May 2009 to support PEMEX's strategic gas program?
Answer to questions 8, 9, 10
In Fiscal Year 2009, Ex-Im Bank approved $1.05 billion in direct loans
and also guaranteed two loans totaling $300 million made by a commercial
lender, to support the sale of U.S.-produced goods and services.
Included in these amounts were a $600 million direct loan for activities
at New Pidiregas Projects (NPP), and $300 million direct loan for
activities at the Cantarell offshore oil field. A $150 million direct
loan was also approved in Fiscal Year 2009 for acquisitions of U.S.
goods and services in connection with PEMEX's Strategic Gas Program
(PEG).
In total, Ex-Im Bank supported a total of $1.35 billion in loans and
loan guarantees to support the sale of U.S. goods and services produced
by American workers in 2009.
11. Why should the taxpayer pay to provide these loans?
Actually taxpayers do not pay anything for either the loans that foreign
buyers receive or the operation of Ex-Im Bank. The companies that
receive Ex-Im Bank financing pay for that financing through the fees
and/or interest that they pay.
The revenue earned by the Bank pays for all of the costs of operating
the Bank. In fact, since 1992, Ex-Im Bank has given U.S. taxpayers
about $5 billion in excess of the cost of Bank operations.