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July 25, 2014
Preliminary Results as of June 30, 2014
Forward-Looking Statement and Cautionary Note Variations
If no further specification is included, changes are made against the same period of the last year.
Rounding
Numbers may not total due to rounding.
Financial Information
Excluding budgetary and volumetric information, the financial information included in this report and the annexes hereto is based on unaudited consolidated financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards
Board (“IFRS”), which PEMEX has adopted effective January 1, 2012. Information from prior periods has been retrospectively adjusted in certain accounts to make it comparable with the unaudited consolidated financial information under IFRS. For more information regarding the transition to IFRS, see
Note 23 to the consolidated financial statements included in Petróleos Mexicanos’ 2012 Form 20-F filed with the Securities and Exchange Commission (SEC) and its Annual Report filed with the Comisión Nacional Bancaria y de Valores (CNBV). EBITDA is a non-IFRS measure. We show a
reconciliation of EBITDA to net income in Table 33 of the annexes to this report. Budgetary information is based on standards from Mexican governmental accounting; therefore, it does not include information from the subsidiary companies of Petróleos Mexicanos.
Foreign Exchange Conversions
Convenience translations into U.S. dollars of amounts in Mexican pesos have been made at the established exchange rate, as of June 30, 2014, of MXN 13.0323 = USD 1.00. Such translations should not be construed as a representation that the peso amounts have been or could be converted into
U.S. dollars at the foregoing or any other rate.
Fiscal Regime
Since January 1, 2006, PEMEX has been subject to a new fiscal regime. Pemex-Exploration and Production’s (PEP) tax regime is governed by the Federal Duties Law, while the tax regimes of the other Subsidiary Entities continue to be governed by Mexico’s Income Tax Law. The most important duty
paid by PEP is the Ordinary Hydrocarbons Duty (OHD), the tax base of which is a quasi operating profit. In addition to the payment of the OHD, PEP is required to pay other duties.
Under PEMEX’s current fiscal regime, the Special Tax on Production and Services (IEPS) applicable to gasoline and diesel is regulated under the Federal Income Law. PEMEX is an intermediary between the Secretary of Finance and Public Credit (SHCP) and the final consumer; PEMEX retains the
amount of IEPS and transfers it to the Federal Government. The IEPS rate is calculated as the difference between the retail or “final price,” and the “producer price.” The final prices of gasoline and diesel are established by the SHCP. PEMEX’s producer price is calculated in reference to that of an
efficient refinery operating in the Gulf of Mexico. Since 2006, if the “final price” is lower than the “producer price”, the SHCP credits to PEMEX the difference among them. The IEPS credit amount is accrued, whereas the information generally presented by the SHCP is cash-flow.
Hydrocarbon Reserves
Pursuant to Article 10 of the Regulatory Law to Article 27 of the Political Constitution of the United Mexican States Concerning Petroleum Affairs, (i) PEMEX's reports evaluating hydrocarbon reserves shall be approved by the National Hydrocarbons Commission (NHC); and (ii) the Secretary of Energy
will register and disclose Mexico's hydrocarbon reserves based on information provided by the NHC. As of the date of this report, this process is ongoing.
As of January 1, 2010, the Securities and Exchange Commission (SEC) changed its rules to permit oil and gas companies, in their filings with the SEC, to disclose not only proved reserves, but also probable reserves and possible reserves. Nevertheless, any description of probable or possible reserves
included herein may not meet the recoverability thresholds established by the SEC in its definitions. Investors are urged to consider closely the disclosure in our Form 20-F and our Annual Report to the CNBV and SEC, available at http://www.pemex.com/.
Forward-looking Statements
This report contains forward-looking statements. We may also make written or oral forward-looking statements in our periodic reports to the CNBV and the SEC, in our annual reports, in our offering circulars and prospectuses, in press releases and other written materials and in oral statements made by
our officers, directors or employees to third parties. We may include forward-looking statements that address, among other things, our:
• exploration and production activities, including drilling;
• activities relating to import, export, refining, petrochemicals and transportation of petroleum, natural gas and oil products;
• projected and targeted capital expenditures and other costs, commitments and revenues, and
• liquidity and sources of funding.
Actual results could differ materially from those projected in such forward-looking statements as a result of various factors that may be beyond our control. These factors include, but are not limited to:
• changes in international crude oil and natural gas prices;
• effects on us from competition, including on our ability to hire and retain skilled personnel;
• limitations on our access to sources of financing on competitive terms;
• the outcome of Round Zero (as described in our most recent Form 20-F and Annual Report) and our ability to find, acquire or gain access to additional reserves and to develop the reserves that we obtain rights to exploit;
• uncertainties inherent in making estimates of oil and gas reserves, including recently discovered oil and gas reserves;
• technical difficulties;
• significant developments in the global economy;
• significant economic or political developments in Mexico, including developments relating to the implementation of the Energy Reform Decree (as described in our most recent Form 20-F and Annual Report);
• developments affecting the energy sector; and
• changes in our legal regime or regulatory environment, including tax and environmental regulations.
PEMEX
PEMEX is Mexico’s national oil and gas company and was created in 1938. It is the exclusive producer of Mexico’s oil and gas resources. The operating subsidiary entities are Pemex - Exploration and Production, Pemex - Refining, Pemex - Gas and Basic Petrochemicals and Pemex – Petrochemicals.
The main subsidiary company is PMI Comercio Internacional, S.A. de C.V., Pemex’s international trading arm.
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Context 2Q14
3
85
95
105
115
4/13 6/13 8/13 10/13 12/13 2/14 4/14 6/14
Prices of Crude Oil USD/barrel
Mexican Mix
WTI
Avg 2Q13:
98.55 USD/b
Avg 2Q14:
97.42 USD/b
2.2
2.4
2.6
2.8
3.0
3.2
4/13 6/13 8/13 10/13 12/13 2/14 4/14 6/14
Prices of Reg Gasoline in the USGM USD/Gal
Avg 2Q13:
281.02 USD/Gal
Avg 2Q14:
293.23 USD/Gal
11.5
12.0
12.5
13.0
13.5
14.0
4/13 6/13 8/13 10/13 12/13 2/14 4/14 6/14
Exchange Rate MXN/USD
Jun 30, 2014:
13.0323 MXN/USD
Jun 30, 2013:
13.0235 MXN/USD
2.5
3.5
4.5
5.5
6.5
7.5
8.5
4/13 7/13 10/13 1/14 4/14
Prices of Natural Gas USD/MMBtu
Avg 2Q13:
4.10 USD/MMBtu
Avg 2Q14:
4.68 USD/MMBtu
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Crude Oil Production Mbd
• During 2Q14, crude oil
production averaged 2,468
Mbd.
5
55% 54% 53% 53% 53%
33% 34% 34% 34% 35%
12% 12% 12% 12% 12%
2,516 2,506 2,523 2,492 2,468
2Q13 3Q13 4Q13 1Q14 2Q14
Heavy Light Extra-light
75%
25%
Offshore Onshore
-
300
600
900
1,200
1,500
1,800
2,100
2,400
2,700
1-Jun-13 1-Aug-13 1-Oct-13 1-Dec-13 1-Feb-14 1-Apr-14 1-Jun-14
Daily Production
Heavy Light Extra light
Natural Gas Production
• Natural gas use as a
percentage of production in
2Q14 was 96.1%
6
68% 70% 72% 72% 72%
32% 30% 28% 28% 28%
5,558 5,635 5,754 5,808 5,762
2Q13 3Q13 4Q13 1Q14 2Q14
Natural Gas Production1
MMcfd
Associated Non-Associated
108 121 180 177
225 1.9% 2.1%
3.1% 3.1%
3.9%
2Q13 3Q13 4Q13 1Q14 2Q14
Gas Flaring MMcfd
Gas Flaring (MMcfd)
Gas Flaring / Total GasProduced
42%
58%
Offshore Onshore
Operational Infrastructure
7
147 142 96 88 107
21 23
21 14 17
169 165
117 102
124
2Q13 3Q13 4Q13 1Q14 2Q14
Drilling Equipment Average
Exploration
Development
6,501 6,468 6,435 6,424 6,333
3,314 3,363 3,281 3,301 3,180
9,816 9,831 9,716 9,725 9,513
2Q13 3Q13 4Q13 1Q14 2Q14
Wells Average
Non-Associated Gas
Crude oil
187 174 169 132
102
7 9 18
6 7
194 183 187
138 109
2Q13 3Q13 4Q13 1Q14 2Q14
Completion of Wells Exploration
Development
6%
94%
Offshore
Onshore
1,098 864
1,134
1,192 545
4,210 3,108
2,371
5,707
296 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000
-
500
1,000
1,500
2,000
2Q13 3Q13 4Q13 1Q14 2Q14
Km2 Km
Seismic Information
2D (Km) 3D (Km )2
62%
38%
Exploration
Offshore Onshore
42%
58%
Development
Offshore Onshore
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Crude Oil Processing
Crude oil processing and
production of petroleum
products amounted to 1,189
Mbd and 1,401 Mbd,
respectively.
9 (1) Includes paraffin, furfural extract, aeroflex, asphalt, lubricants, coke, cyclical light oil and other gasolines.
786 718 674 651 676
512 478 485 506 514
1,298 1,196 1,158 1,157 1,189
2Q13 3Q13 4Q13 1Q14 2Q14
Crude Oil Processing Mbd
Heavy Crude
Light Crude
462 437 425 430 453
298 258 237 241 276
340 305 306 282
307
206 208 203 214
210
61 57 63 57
59
101 96 103 105
97
1,468 1,361 1,337 1,330
1,401
2Q13 3Q13 4Q13 1Q14 2Q14
Production of Petroleum Products Mbd Other*
Jet Fuel
LPG
Diesel
Fuel oil
Automotive gasolines
1
Natural Gas Processing, Dry Natural Gas and Gas Liquids Production
10 (1) Includes condensate process.
3,164 3,409 3,411 3,412 3,334
1,089 1,061 998 972 976
4,253 4,471 4,409 4,384 4,311
2Q13 3Q13 4Q13 1Q14 2Q14
Processing MMcfd
Sweet Wet Gas
Sour Wet Gas
3,600
3,755
3,660 3,671
3,593
354 368 364 369 368
310
340
370
400
430
460
490
520
3,200
3,400
3,600
3,800
2Q13 3Q13 4Q13 1Q14 2Q14
Mbd MMcfd
Production Dry Gas from Plants(MMcfd)
Natural Gas Liquids(Mbd)
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Production of Petrochemicals
11 (1) Includes muriatic acid, butadiene, polyethylene wax, petrochemical specialities, BTX liquids, hydrogen, isohexane, pyrolysis liquids, oxygen, CPDI, sulfur, isopropyl alcohol, amorphous gasoline, octane basis gasoline and
heavy naphtha.
Mt
130 126 113 112 98
343 350 309 360 350
336 248
258 282
262
146 175
140
165 177
110 112
130
123 125
405 400
341
399 354
1,471 1,412
1,291
1,441 1,366
2Q13 3Q13 4Q13 1Q14 2Q14
Other*
Propylene and Derivatives
Aromatics and Derivatives
Ethane Derivatives
Methane Derivatives
Basic
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2Q14 Financial Highlights
13 (1) Excludes IEPS.
(2) Earnings before interests, taxes, depreciation and amortization.
(3) The established exchange rate at June 30, 2014 is of MXN 13.0323 = USD 1.00.
2Q13 2Q14
Variation
2Q13 2Q14
MXN
Billion
USD3
Billion
Total Sales1 393.2 409.1 4.0% 30.2 31.4
Gross Income 208.8 200.4 -4.1% 16.0 15.4
Operating Income 197.3 171.1 -13.3% 15.1 13.1
Income before Taxes and
Duties 159.3 164.9 3.5% 12.2 12.7
Taxes and Duties 208.3 217.9 4.6% 16.0 16.7
Net Income (loss) (49.0) (53.0) 8.1% (3.8) (4.1)
EBITDA2 265.0 236.2 -10.9% 20.3 18.1
Total Sales Evolution 2Q13 – 2Q14
14
MXN billion
393.2 409.1 10.1 6.7 (0.9)
2Q13 Domestic Sales Exports ServicesIncome
2Q14
Mil
lare
s
4.0%
Operating Income Evolution 2Q13 – 2Q14
15
MXN billion
-13.3%
197.3
171.1
(8.5) (15.2)
0.1 2.5
2Q13 Gross income Other revenues Transportationand distribution
expenses
Administrativeexpenses
2Q14
Mil
lare
s
Net Income and Comprehensive Income
16
Net Income Composition – 2Q14
MXN billion
Comprehensive Income Evolution 2Q13-2Q14
MXN billion
(1) Profit (loss) sharing in non-consolidated subsidiaries, affiliates and others.
171.1
(53.0)
(9.7) 3.5
0.0
(217.9)
OperatingIncome
InterestExpense
ForeignExchange
Income
Profit Sharing Taxes andDuties
Net Loss
Mil
lare
s
1
(45.3)
(52.4)
(4.0)
(3.1)
2Q13 NetIncome
OtherComprehensive
Results
2Q14
Milla
res
750.6 795.1 836.7 760.5
133.0 90.7 130.0 (38.0)
(3.1) (88.4) 841.2
925.1 0.4 47.7 (56.1)
Total Debt2013
FinancingActivities
DebtPayments
ForeignExchangeFluctuation
Others Total Debt2Q14
Cash & CashEquivalents
Net Debt2Q14
Net Debt2013
Mil
lare
s
1
2
Consolidated Debt as of June 30, 2014
17 (1) Includes Finance Public Works Contracts Program.
(2) Includes accrued interests and amortized cost.
MXN billion PMI debt
Petróleos Mexicanos debt Short-Term
Long-Term
10.0%
5.9 5.2 6.2
5.1 5.5 5.5 5.1 5.3 3.3 2.7 3.5
1.4 1.6 0.3 0.3
13.1
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 ---
Term Structure – Consolidated Debt1
Debt as of June 30, 2014
USD billion
Financial Markets
18
USD 4,000,000,000
2019; 3.125%
2024; 4.875%
2045; 6.375%
Petróleos Mexicanos
January 23, 2014
MXN 12,500,000,000
2026; 3.94%
2019; TIIE 28D+6bps
2024; 7.19%
Petróleos Mexicanos
January 30, 2014
USD 300,000,000
2018; 2.351%
Credit Line
Petróleos Mexicanos
March 21, 2014
1Q14
EUR 1,000,000,000
2026; 3.75%
Petróleos Mexicanos
April 16, 2014
2Q14 3Q14 MXN 15,000,000,000
2019; TIIE 28D+4bps
2024; 7.19%
2026; 3.94%
Petróleos Mexicanos
July 2, 2014
Credit Ratings
19
0.45 0.49 0.50 0.46 0.47 0.45 0.48 0.46 0.47 0.50 0.52 0.56 0.57
0.68 0.74 0.73
0.65 0.68 0.63 0.69 0.68 0.70
0.76 0.85
0.93 0.98
as of June 30,2011
as of Dec 31,2011
as of June 30,2012
as of Dec 31,2012
as of June 30,2013
as of Dec 31,2013
as of June 30,2014
Debt / Sales Debt / EBITDA
Fitch HR Moody’s Standard &
Poor’s
Foreign Currency
(Global Scale) BBB+ NA A3 BBB+
Local Currency
(National Scale) AAA(mex) HR AAA Aaa.mx mxAAA
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