RESULTS AS OF SEPTEMBER 30, 2017

Transcription

1 RESULTS AS OF SEPTEMBER 30, 2017 Mexico City, October 27, 2017 PEMEX 1 presents its financial and operating results for the third quarter of 2017 (3Q17 2 ). 1. Key highlights PEMEX guaranteed fuel supply throughout the country despite the earthquakes and hurricanes observed during the quarter. Crude oil production is line with the annual goal of 1,944 thousand barrels per day (Mbd); production during the quarter averaged 1,884 Mbd. A decree was published to grant fiscal benefits for assignments that are not profitable after taxes. Divestiture of 50% stake in Ductos y Energéticos del Norte, which represents 25% of the Ramones II Norte gas pipeline. Natural gas use is still improving and reached 96.7%. Crude oil processing was affected due to various natural phenomena and averaged 647 Mbd. Farm-outs will yield an initial income of USD million for PEMEX. There are some external factors that continue to impact PEMEX s financial results: depreciation of the Mexican peso against the U.S. dollar, recognition of logistic expenses in the prices of fuels, recovery of crude oil international prices and gradual liberalization of gasoline and diesel prices. Operating (Mbd) 3Q16 3Q17 Variation % Crude Oil Production 2,138 1,884 (11.9) Crude Oil Processing (23.8) Financial (MXN billion) Operating income (loss) (22.7) Net income (loss) (118.3) (101.8) 14.0 EBITDA (3.5) 1 PEMEX refers to Petróleos Mexicanos, its Productive Subsidiary Companies, Affiliates, Subsidiary Entities and Subsidiary Companies. 2 From July 1 to September 30, PEMEX encourages the reader to analyze this document together with the information provided in the annexes to this document, in addition to the transcript of its conference call announcing its quarterly results, to take place on October 27, Annexes, transcripts and relevant documents related to this call can be found at /en/investors. 3 Earnings Before Interest, Taxes, Depreciation, and Amortization.

2 Uses and Sources of Funds as of September 30, 2017 (MXN million) 540, , , ,670 80,896 43, , , ,123 Cash at the Beginning of the Year Cashflow from Operating (a) Activities Financing Activities (b) Available Cashflow Financial Debt Payments Interest Paid Investments Taxes and Duties Cash at the End of the Period (c) a) Before taxes and duties. Calculated by adding accrued taxes and duties to revenues from operations from the statement of changes in financial position. b) Excludes E&P Financed Public Works Contract Program. c) Includes (i) a MXN (321) million effect from exploration expenses, investment in shares, dividend revenue and financial instruments available for sale and (ii) change of cash effect of MXN (8,127) million. 2. Operating Results PEMEX Main Statistics of Production Third quarter (Jul.-Sep.) Nine months ending Sep. 30, Change Change Upstream Total hydrocarbons (Mboed) 2,997 2, % (609) 3,087 2, % (430) Liquid hydrocarbons (Mbd) 2,172 1, % (260) 2,219 2, % (218) Crude oil (Mbd) 2,138 1, % (255) 2,182 1, % (210) Condensates (Mbd) % (5) % (7) Natural gas (MMcfd) (1) 5,697 4, % (840) 5,893 5, % (732) Natural gas (MMcfd) (2) 4,770 4, % (679) % (699) Downstream Dry gas from plants (MMcfd) (3) 2,994 2, % (308) 3,117 2, % (370) Natural gas liquids (Mbd) % (43) % (20) Petroleum products (Mbd) (4) % (214) 1, % (169) Petrochemical products (Mt) 1, % (163) 3,206 2, % (531) (1) Includes nitrogen. (2) Does not include nitrogen. (3) Does not include dry gas used as fuel. (4) Includes LPG PEMEX Results Report as of September 30, / 28

3 2.1 Exploration and production Crude Oil Production During the third quarter of 2017, crude oil production averaged 1,884 Mbd, a 255 Mbd decrease as compared to the same period of Notwithstanding, accumulated production from January to September 2017 recorded 1,971 Mbd, figure greater than the annual crude oil production target of 1,944 Mbd. In general, crude oil production decreased as a consequence of the passage of hurricanes Harvey and Katia. Weather conditions inhibited production in some fields, and increased inventory build-up in certain assets that cannot be reached through ships. Pemex Exploration and Production carried out maintenance works in advance to platforms at the Zaap field of the Ku- Maloob-Zaap asset, which will allow for a recovery in production to reach the annual target. The quarterly variation is explained by: a 13.3% or 103 Mbd decrease in the production of light crude oil, primarily due to a natural decline in production at the Chuc, Kuil, Chuhuk and Ixtal fields of the Abkatún-Pol-Chuc business unit, as well as at Puerto Ceiba of the Bellota-Jujo business unit; Ayocote, Guaricho, and Rabasa of the Cinco Presidentes business unit; and Artesa and Shishito of the Macuspana-Muspac business unit; an 8.8% or 97 Mbd decrease in the production of heavy crude oil, mainly explained by the halt in offshore production that resulted from high inventories as a consequence of the passage of hurricanes Harvey and Katia, and as a result of the natural decline in the production of fields, in addition to an increase in the fractional water flow of wells in highly fractured deposits of the Cantarell business unit; and a 20.9% or 54 Mbd decrease in extra-light crude oil production, due to the natural decline in the production of fields, as well as an increase in the fractional water flow of wells of the Samaria-Luna, Bellota-Jujo and Litoral de Tabasco business units. Crude Oil Production by Type (Mbd) Crude Oil Production by Region 2,138 2,070 2,018 2, % 11.7% 11.1% 10.8% 36.2% 35.6% 35.7% 35.9% 1, % 35.6% 19% 81% 51.6% 52.7% 53.2% 53.4% 53.4% 3Q16 4Q16 1Q17 2Q17 3Q17 Heavy Light Extra-light Offshore Onshore PEMEX Results Report as of September 30, / 28

4 Crude Oil Production by Asset (Mbd) 2,000 1,600 1, ,884 14% Other 5% Samaria Luna 11% Abkatún-Pol-Chuc 18% Litoral de Tabasco 9% Cantarell 44% Ku-Maloob-Zaap - 3Q16 4Q16 1Q17 2Q17 3Q17 Natural Gas Production Natural gas production decreased by 14.2% 4 to 4,091 million cubic feet per day (MMcfd), as a result of: a 13.8% decrease in associated gas production, primarily due to the natural decline of fields and an increase in the fractional water flow of wells of the Abkatún-Pol-Chuc, Litoral de Tabasco, Bellota-Jujo, Samaria-Luna, and Macuspana-Muspac business units. Additionally, the decrease in production at the Cantarell and Ku-Maloob-Zaap business units is mainly explained by the halt in crude oil production due to high inventories as a result of the passage of hurricanes Harvey and Katia; and a 15.5% decrease in non-associated gas production, mainly due to a natural decline in production at the Veracruz and Burgos business units of the Northern region. Particularly, the Burgos and Veracruz business units, main non-associated gas producing assets, reached a joint production of 928 MMcfd, which represents 19.1% of total gas production and 92.3% of non-associated gas production. 4,770 4, % 24.9% Natural Gas Production (MMcfd) 4,367 4, % 23.7% 4, % 73.5% 75.1% 76.1% 76.3% 76.3% Natural Gas Production by Type of Field 50% 50% Offshore Onshore 3Q16 4Q16 1Q17 2Q17 3Q17 Associated Non-Associated 4 Does not include nitrogen. PEMEX Results Report as of September 30, / 28

5 5,600 4,800 4,000 Natural Gas 5 by Asset (MMcfd) 4,857 26% Other 3,200 24% Cantarell 2,400 6% Abkatún-Pol-Chuc 5% Veracruz 1,600 9% Samaria Luna % Litoral de Tabasco - 13% Burgos 3Q16 4Q16 1Q17 2Q17 3Q17 Gas Flaring Gas flaring continues to decrease, and during the third quarter of 2017 it was reduced by 68.2%, to 160 MMcfd, primarily as a result of the completion of works for gas utilization on marine rigs. As a result, natural gas 6 use as a percentage of production during the period amounted to 96.7%. Gas Flaring 8.8% 7.6% % % % 160 3Q16 4Q16 1Q17 2Q17 3Q17 Gas Flaring (MMcfd) Gas Flaring / Total Gas Produced Infrastructure During the quarter, the average number of operating wells totaled 7,930, a 6.9% decrease as compared to the same period of 2016, as a result of lower activity due to the strategy aimed at increasing economic value, and due to the natural decline of some fields. The highest activity in crude oil and associated gas producing wells is focused on the Aceite Terciario del Golfo and Poza Rica Altamira business units, of the Northern Region. On the other hand, non-associated gas producing wells are concentrated on the Burgos business unit. Completion of wells decreased by 5, primarily due to a decrease in the completion of development wells. This was a result of implemented budget adjustment measures. In contrast, five exploration wells were completed during the third quarter of 2017, an additional well as compared to the previous year, which allows the company to continue exploration activities with four wells in shallow waters and one onshore well. 5 Includes nitrogen. 6 Since 2016, the natural gas index as a percentage of total production includes nitrogen PEMEX Results Report as of September 30, / 28

6 Average Number of Operating Wells Average Operating Wells by Type of Field 8,514 8,351 8,240 8,022 7,930 3,265 3,146 3,060 2,950 2,926 7% 5,249 5,205 5,180 5,072 5,004 93% Offshore Onshore 3Q16 4Q16 1Q17 2Q17 3Q17 Crude oil Non-Associated Gas Completed Wells Q16 4Q16 1Q17 2Q17 3Q17 Development Exploration Average Number of Operating Drilling Rigs Q16 4Q16 1Q17 2Q17 3Q17 Development Exploration PEMEX Results Report as of September 30, / 28

7 Development Average Drilling Rigs by Type Exploration 5.0, 32% 10.7, 68% 3.9, 33% 8.0, 67% Offshore Onshore Offshore Onshore Discoveries As a result of the exploratory activities carried out during the third quarter of 2017, the following discoveries were made: Valeriana-1 onshore well of the Comalcalco project, revealed positive results in the production of condensates and gas; Wells Octli-1and Xikin-1DL of the Uchukil project, and Hok-1 of the Chalabil project, turned out to be potential oil and gas producers in shallow waters; and Cahua-1 well also in shallow waters, revealed positive results regarding condensates and gas, and is part of the Uchukil project. It is worth mentioning that after a discovery is made, the estimated resources need to be certified through a process that considers: Internal record of discovered hydrocarbon resources; Evaluation of the fields potential (through external firms);and Request for an audit conducted by the National Hydrocarbons Commission. PEMEX Main discoveries 3Q17 Project Well Geologic age Initial production Water depth Type of hydrocarbon Crude & Gas condensates (MMcfd) (bd) meters Comalcalco Valeriana-1 Late Jurassic Kimmeridgian 1, Gas & condensates Uchukil Octli-1 Early Pliocene 3, Crude oil & gas Uchukil Xikin-1DL Late Jurassic Kimmeridgian 1, Crude oil & gas Chalabil Hok-1 Late Miocene 2, Crude oil & gas Uchukil Cahua-1 Early Pliocene 2, Gas & condensates Total 10, PEMEX Results Report as of September 30, / 28

8 2.2 Additional Information Related to E&P Nobilis- Maximino Farm-out Contracts for the Exploration and Extraction of hydrocarbons On September 18, 2017, the National Hydrocarbons Commission (CNH) published the tender for the international public bidding process for the Nobilis-Maximino farm-out. The winners of the tender will be announced on January 31, On September 25, 2017, Petróleos Mexicanos through Pemex Exploration and Production (PEP) signed the Contracts for the Exploration and Extraction (CEE) of hydrocarbons in shallow waters with Deutsche Erdoel AG and Ecopetrol for blocks 2 and 8, respectively, which were awarded by the CNH during Round 2.1. These agreements contribute to PEMEX s reserves incorporation targets established in the Business Plan to maximize the Mexico s hydrocarbon resources. Ogarrio and Cárdenas-Mora Farm-outs Bidding Process On October 4, 2017, the CNH carried out the bidding process for PEMEX s farm-outs Ogarrio, Cárdenas-Mora and Ayín-Batsil, to optimize the exploitation and development of the fields. Onshore projects Ogarrio and Cárdenas-Mora were awarded. Partner Initial Payment Additional Royalty 13% Cash Payment 3P Reserves Type of Hydrocarbons Cárdenas-Mora Cheiron Holdings Limited (Egypt) USD 125 million USD 41.5 million 93.2 MMboe Extra-light crude oil (40 API) and light crude oil (38 API) Partner Initial Payment Additional Royalty 13% Cash Payment 3P Reserves Type of Hydrocarbons Ogarrio DEA Deutsche Erdoel AG (Alemania) USD 190 million USD million 54.0 MMboe Light crude oil (38 API) and wet gas With these actions, PEMEX moves forward in its joint-venture strategy to diversify and optimize its projects and investments portfolio, taking advantage of the tools provided by the Energy Reform. CSIEE San Ramón and Blasillo In December 2016, the Board of Directors of Petróleos Mexicanos approved the business case for fields San Ramón and Blasillo under the Comprehensive Service Contracts for Exploration and Extraction (Contratos de Servicios Integrales de Exploración y Extracción, CSIEE) for conventional and non-conventional fields. This contract scheme aims to complement investment and execution capacity through thirdparties for the optimization and operation of mature fields. Also, to take advantage of experts technology that can be applied where PEMEX needs it, to increase recovery factors through the extraction of certified hydrocarbon reserves and the implementation of secondary recovery methods, which will allow obtaining approximately 39 MMboe. PEMEX Results Report as of September 30, / 28

9 During the third quarter of 2017, PEMEX has progressed in the bidding process and expects to sign the contract by year-end, and start operations with third parties during the first half of Q17 E&P Infrastructure Maintenance In the quarter, PEP carried out programmed maintenance Works at the FPSO 7 Yúum K ak náab in addition to anticipating maintenance works at the Zaap field of the Ku-Maloob-Zaap business unit. These actions are aimed at preserving PEMEX s infrastructure in optimal conditions without impacting the annual production target. 2.3 Industrial Transformation Crude oil processing During the third quarter of 2017, total crude oil processing averaged 647 Mbd, a 23.8% decrease as compared to the same period of This decrease in the National Refining System (Sistema Nacional de Refinación, SNR) was mainly a result of the following factors: The Salina Cruz refinery was out of operation in June and July 2017 due to an incident in the pump house, caused by floodings from Tropical Storm Calvin. The emergency shutdown in this refinery was seized to execute scheduled maintenances in advance, to improve its performance and reliability. Operations restarted by the end of July, which allowed for a recovery in crude oil processing, from 667 Mbd in July to 734 Mbd in August. A comprehensive maintenance program was implemented at the Madero refinery, in accordance with the strategy to reach optimal processing levels and increase the production of high-yield refined products. Due to this scheduled maintenance program, the Madero refinery is shutdown since late August. An emergency shutdown at the Salina Cruz refinery on September 7, due to an earthquake and its aftershocks. There were no structural damages to the refinery but two power generators were affected. Rehabilitation works took place in September and two new turbo-generators were acquired. As of the date of this document, the Salina Cruz refinery is being evaluated for the restart of operations. During the quarter, the Salina Cruz refinery had to shut down in two occasions; first, due to Tropical Storm Calvin, and second, due to the earthquake on September 7 and its aftershocks. This atypical coincidence of natural phenomena had an important effect on crude oil processing. In contrast, Tula and Cadereyta refineries recorded an improvement in performance, by 51 Mbd and 16 Mbd respectively, as compared to the same period of 2016, as a result of the strengthening of the operational discipline and maintenance to critical equipment. PEMEX s usage of its primary distillation capacity decreased by 12.6 percentage points, mainly due to the effects on the Salina Cruz and Madero refineries previously described. In contrast, Salamanca and Tula refineries recorded an improvement in performance, with above average primary distillation capacity. 7 Floating Production Storage and Offloading vessel. PEMEX Results Report as of September 30, / 28

10 Crude Oil Processing (Mbd) Q16 4Q16 1Q17 2Q17 3Q17 Light Crude Heavy Crude Production of Petroleoum Products Lower crude oil processing in the quarter caused a 24.4% decrease in total petroleum products output. Gasolines and diesel production decreased by 70 Mbd and 59 Mbd, respectively. This decrease is explained by shutdowns at the Salina Cruz refinery due to natural phenomena and the comprehensive maintenance works at the Madero refinery. These effects were partially offset by the Tula refinery s increase in production as compared to the same period of Petroleum Products Production (Mbd) Other* Jet Fuel LPG Diesel Fuel oil Automotive gasolines Q16 4Q16 1Q17 2Q17 3Q17 * Includes paraffins, furfural extract, aeroflex, asphalt, lubricants, coke, cyclical light oil and other gasolines. Variable Refining Margin During the third quarter of 2017, the SNR recorded a positive variable refining margin of USD 8.98 per barrel, a USD 6.34 per barrel increase, as compared to the third quarter of This increase is explained by two factors: (i) higher prices of refined products as a result of Texas and Louisiana s refineries shutdowns; and (ii) inventories revaluation. PEMEX Results Report as of September 30, / 28

11 Variable Refining Margin (USD /b) Q16 4Q16 1Q17 2Q17 3Q17 PEMEX Gas Stations As of September 30, 2017, PEMEX gas stations totaled 11,710, this represents a 220 increase as compared to the third quarter of Natural Gas Processing and Production Natural gas processing decreased by 11.4%, as compared to the third quarter of 2016, primarily due to the decreased availability of sour wet gas from the Mesozoic, as well as a reduction in the supply of sweet wet gas from the Burgos basin. As a result, dry gas production in plants totaled 2,685 MMcfd, a 10.3% decrease as compared to the third quarter of Natural gas liquids production decreased by 13.6%, to 274 Mbd. Condensates processing decreased by 15.0% as compared to the same period of 2016, primarily due to a decline in the supply of sour condensates from the Mesozoic and sweet condensates from Burgos. Natural Gas Processing (MMcfd) 3, ,470 3,413 3,368 3, ,004 2,862 2,813 2,804 2,704 3Q16 4Q16 1Q17 2Q17 3Q17 Sour Wet Gas Sweet Wet Gas PEMEX Results Report as of September 30, / 28

12 MMcfd Mbd 3Q17 Dry Gas and Natural Gas Liquids Production 3,200 2,900 2,600 2,300 2,000 2,994 2,838 2,783 2,775 2, Q16 4Q16 1Q17 2Q17 3Q Dry Gas from Plants (MMcfd) Natural Gas Liquids (Mbd) 1 (1) Includes condensates process. Does not include sweet condensates. Petrochemicals Production During the quarter, production of petrochemical products totaled 847 Mt, a 16.2% decrease, as compared to the same period of 2016, primarily due to the following: a 66 Mt decrease in the ethane derivatives chain, due to lower supply of ethane; a 54 Mt decrease in the propylene and derivatives chain, due lower crude oil processing at the Salina Cruz refinery, and the closure of the acrylonitrile plant at the Morelos Petrochemical Complex after the end of the contract with Unigel in September 2016; a 13 Mt decrease in the methane derivatives chain, due to lower availability of ammonia, which was partially offset by an increase in the production of methanol at the Independencia Petrochemical Complex; and an 11 Mt decrease in the production of other petrochemicals, mainly due to lower crude oil processing and sour gas. 1, Petrochemical Production (Mt) Other* Carbon black Sulfur Propylene and Derivatives Q16 4Q16 1Q17 2Q17 3Q17 Aromatics and Derivatives Ethane Derivatives Methane Derivatives *Includes muriatic acid, butadiene, polyethylene wax, petrochemical specialities, BTX liquids, hydrogen, isohexane, pyrolysis liquids, oxygen, CPDI, isopropyl alcohol, amorphous gasoline, octane basis gasoline and heavy naphtha. PEMEX Results Report as of September 30, / 28

13 2.4 Additional Information Related to Industrial Transformation Joint-venture with Air Liquide On September 6, 2017, PEMEX formalized the contracts with Air Liquide México S.A. de R.L. de C.V. for the supply of hydrogen at the Tula refinery in the state of Hidalgo, for the next 20 years. In accordance with the contract, Air Liquide will operate the existing plant and will invest in a second plant to supply the total hydrogen required for the Tula refinery extension projects. This joint venture will allow PEMEX to generate savings and improve hydrogen supply reliability, therefore decreasing non-scheduled shutdowns and increasing gasolines production in the refinery. Hydrogen Supply in Madero and Cadereyta Refineries On September 12, 2017, Petróleos Mexicanos started the process to select business partners for the supply of hydrogen at the Cadereyta and Madero refineries in Nuevo León and Tamaulipas, respectively. The evaluation of technical-economical proposals is currently underway. These transactions will generate direct income of approximately USD 134 million. In addition to allow cost reductions and decrease non-scheduled shutdowns, these joint ventures will increase reliability in hydrogen generation to reduce risks in crude oil processing capacity, strengthen the operating performance at the refineries and increase gasolines and diesel production, in line with the Business Plan. 2.5 Industrial Safety Frequency Index 8 As of September 30, 2017, the frequency index recorded 0.23 injuries per million man-hours worked (MMhh), a 34.7% decrease compared to the same period of Severity Index 9 During the third quarter of 2017, the severity index was 24 days lost per MMhh, an 8.3% decrease as compared to the same period of To reverse the trend observed in severe accidents, Petróleos Mexicanos reinforces Safety, Health and Environmental Protection s (SSPA for its acronym in Spanish) initiatives, such as the follow-up to audit and technical support programs for the effective execution of the SSPA, evaluations to SSPA leaders, compliance with SSPA s ZERO Tolerance s twelve guidelines, individual development plans and SSPA career plans. Additionally, the following campaigns are being carried out in 2017: Safety, order and cleanness ; Same level fall prevention (this type of accident accounted for approximately 23% of the incapacitating injuries in the last two years); and Everyone safe, everyone on board (specifically in Pemex Exploration and Production and Pemex Perforation) in order to increase safety and health. Effects of Natural phenomena in In September 2017, hurricanes and earthquakes affected Mexico, nevertheless, PEMEX s facilities did not suffer structural damage and remain safe. Additionally, fuels supply was guaranteed nationwide due to sufficient reserves of gasoline and diesel from various markets. 8 Refers to the number of accidents with incapacitating injuries per million man-hours worked (MMhh) with risk exposure during the relevant period of time. An incapacitating injury is an injury, functional damage or death that is caused, either immediately or subsequently, by a sudden event at work or during work-related activities. Man-hours worked with risk exposure represent the number of hours worked by all personnel, including overtime hours. 9 Refers to the total number of days lost per million man-hours worked with risk exposure during the relevant period of time. The number of days lost is based on medical leaves of absence for injuries stemming from accidents at work, plus the number of corresponding days on which compensation is paid for partial or total disability or death. PEMEX Results Report as of September 30, / 28

14 September On the other side, due to the earthquakes on September 7 and 19, and their aftershocks, the Salina Cruz refinery, located in the state of Oaxaca, went into a preventive stop of operations for safety reasons; it is expected to resume operations by the end of October. 2.6 Environmental Protection As a result of the aforementioned natural phenomena, refining capacity substantially decreased during the period, below programmed figures, and crude oil production needed to be decreased due to high levels of stock in crude oil storage. It is important to highlight that despite these events, PEMEX will reach its annual average production target of 1,944 Mbd, as a result of high levels of production in August above program-, which will contribute to compensate the decrease in September. Sulfur Oxide Emissions Water Reuse During the third quarter of 2017, sulfur oxide emissions decreased by 45.1% as compared to the same quarter of 2016, primarily due to: the decrease of acid gas emissions to burners at the Minatitlán refinery and Gas Processing Complexes (GPC) at Cactus and Poza Rica. Sulfur plants at GPC restarted operations after the maintenance carried out in 2016; and Pemex Exploration and Production s increase in gas utilization. During the third quarter of 2017, water reuse increased by 66.5% as compared to the same period of 2016, primarily due to the Water Supply Collaboration Agreement (WSCA, signed between the Madero refinery and a municipal water commission). The agreement aims to treat urban waste water in a local treatment plant placed at the Río Pánuco to be used at the Francisco I. Madero refinery. PEMEX Results Report as of September 30, / 28

15 3. Financial Results 3.1 Consolidated Income Statement from July 1 to September 30, 2017 Total Sales During the third quarter of 2017, total sales increased by 20.5%, as compared to the same period of 2016, mainly as a result of: a 25.1% increase in domestic sales, mainly in gasolines and diesel, primarily as a consequence of the recovery in international crude oil prices. The volume of gasolines sold in Mexico decreased by 2.8% and the volume of diesel decreased by 8.6%; and a 12.5% increase in exports, largely explained by the recovery in international crude oil prices, from USD per barrel in the third quarter of 2016 to USD per barrel in the same period of 2017, notwithstanding 7.8% and 47.2% decreases in export volumes of crude oil and petroleum products, respectively. The increase in domestic sales also presents an important effect due to the new pricing scheme, implemented in This scheme modifies the calculation formula of maximum prices of gasolines and diesel and recognizes logistics and distribution costs, in addition to the effect of the Mexican peso against the U.S. dollar exchange rate. In addition, the sale prices of gasoline and diesel are being gradually liberalized throughout the country. Sales Evolution (MXN million) 20.5% 274,998 42,865 12, ,352 3Q16 Domestic Sales Exports Services Income 3Q17 Exports (MXN million) 12.5 Crude Exports by Region 113, , ,049 26,018 16,478 83,710 87,025 3Q16 3Q17 Other Petroleum Products Crude Oil and Condensates 1% 47% United States of America Europe 32% 20% Total: 1,176 Mbd Far East Rest of the Americas PEMEX Results Report as of September 30, / 28

16 Domestic Sales (MXN million) Domestic Sales of Petroleum Products 25.1% 213, ,520 5,945 17, ,488 5,213 15, ,601 Petrochemical Products* Dry Gas Petroleum Products 5% 2% 10% 23% 8% 52% Total: 1,558 Mbd Gasolines Fuel oil Diesel LPG Jet Fuel Other 3Q16 3Q17 * Includes Pemex Fertilizers' and Pemex Ethylene's products. Gross & Operating Income Cost of sales increased by 17.9%, primarily as a result of: a MXN 33.1 billion impairment of fixed assets. This item is considered virtual, and mostly does not imply cash outflows; a 16.8% or MXN 17.6 billion increase in purchases for resale, primarily of gasolines and diesel, to satisfy the local demand of petroleum products. The price-effect of this increase was 14%, and the volume-effect was 86%; a 24.8% increase in depreciation and amortization, primarily as a result of the impairment reversal registered at the end of 2016, which increased the value of the fixed assets and consequently, their depreciation and amortization. As a consequence, gross income increased by 33.4% as compared to the third quarter of 2016, and totaled MXN 62.0 billion. Total operating expenses (transportation and distribution expenses and administrative expenses) were stable, in line with the discipline and cost-efficiency policy implemented since As a result, operating income increased by totaled MXN 29.6 billion. PEMEX Results Report as of September 30, / 28

17 Operating Income Evolution (MXN million) -22.7% 38,275 15,544 22, ,431 29,570 3Q16 Gross Income Other Revenues Transportation and Distribution Expenses Administrative Expenses 3Q17 Taxes and Duties During the third quarter of 2017, total taxes and duties amounted to MXN 83.9 billion, a 4.0% decrease as compared to the same period of 2016, mainly as a result of an 11.9% decrease in crude oil production. On August 18, 2017, the Ministry of Finance published a decree to grant fiscal benefits for assignments that are not profitable after taxes under the current tax scheme. This measure (i) increases capital expenditure tax deductions; (ii) acknowledges technical and financial challenges in mature fields; and (iii) establishes that the benefit can be applied to a maximum of 150,000 barrels per day. This retroactive measure is expected to restart crude oil production in certain fields. Initially, 21 assignments would be considered to receive this benefit: 10 in shallow waters, 9 onshore and 2 non-associated natural gas fields. The decree favours both tax collection and PEMEX, as stated in the Business Plan. Evolution of Taxes and Duties (MXN million) 87,442 83,932 3,988 7,497 3Q16 Duties Income Tax and Other 3Q17 PEMEX Results Report as of September 30, / 28

18 Evolution of Net Income (Loss) As of September 30, Petróleos Mexicanos recorded an accumulated net income of MXN 18.9 billion. During this quarter, the company recorded a MXN billion net loss, compared to a MXN billion net loss in the third quarter of 2016, which is a 14.0% improvement. This result was mainly due to the following: a MXN 28.4 billion foreign exchange loss due to the depreciation of the Mexican peso against the U.S. dollar in the period. As of June 30, 2017 the exchange rate was MXN per dollar, compared to MXN at the end of this quarter. This variation is considered virtual and mostly did not represent cash disbursements; a 6.6% increase in financial cost, mainly as a result of higher indebtedness as of September 30, 2017; a MXN billion loss in profit sharing in non-consolidated subsidiaries and affiliates, mainly due to a decrease in Deer Park s results, since it was out of operation during some weeks because of the floods caused by hurricanes. This was partially offset by: a MXN 2.0 billion increase in financial income, mainly as a result of the interest generated by the promissory notes granted by the Federal Government for pension liabilities; and a 4% decrease in taxes and duties, mainly due to the decrease in crude oil production. Evolution of Net Income (Loss) (MXN million) (118,323) (8,705) 351 (189) 23,757 (2,208) 3,510 (101,808) 3Q16 Operating Income Net Interest Expense Financial Derivatives Cost Foreign Exchange Loss Profit Sharing Taxes and Duties 3Q17 Comprehensive Income (Loss) A MXN billion comprehensive income was recorded as a result of a MXN 927 million increase in investment in equity securities, because of the increase in the market value of Repsol s shares and a MXN 1.9 billion loss in the conversion effect, as a result of the depreciation of the Mexican peso against the U.S. dollar. PEMEX Results Report as of September 30, / 28

19 Evolution of Comprehensive Income (MXN million) (113,840) 16,516 (5,194) (102,519) 3Q16 Net Income Other Comprehensive Results 3Q Consolidated Balance Sheet as of September 30, 2017 Working Capital As of September 30, 2017, the company s working capital amounted to MXN 5.2 billion, a 107.3% improvement as compared to December 31, 2016, mainly as a result of: a 312.7% increase in income due to financial derivatives, as a result of the increase in crosscurrency swaps due to the U.S. dollar depreciation against other currencies that PEMEX hedges, as well as the increase in income due to oil and currency hedging; a 25.5% increase in inventories, mainly due to hydrocarbons price recovery and a greater amount of products in transit; a MXN 53.0 billion decrease in cash and cash equivalents, due to tax payments and debt amortizations, in addition to operating and investment expenses, which were partially offset by collections and financing activities; an MXN 11.6 billion increase in notes receivable, mainly due to hydrocarbons price recovery; a 38.2% decrease in suppliers liabilities as a result of the partial payment of existing obligations after the stabilization in this item to a more adequate level, in accordance with PEMEX s size. As of September 30, 2017, 99% of 2016 s suppliers liabilities has been paid and the remaining 1% is scheduled to be paid during the rest of the year; and a 62.9% decrease in derivative financial instruments, mainly due to the maturity and expiration of some cross-currency swaps. PEMEX Results Report as of September 30, / 28

20 Working Capital (MXN million) 57,616 2,714 20,045 (192,225) Current Assets 144,866 Current Liabilities 146,123 (93,776) (24,427) (44,307) (11,437) 5,191 Cash & Cash Equivalents Accounts, Inventories Notes Receivable and Other Noncurrent Assets Kept for Sale Derivative Financial Instruments Short-term Financial Debt Suppliers Accounts and Accrued Expenses Payable Taxes and Duties Payable Derivative Financial Instruments Working Capital Financial Debt Total financial debt decreased by 2.8% as compared to the same period of 2016, mainly due to the effect of the appreciation of the Mexican peso against the U.S. dollar. As of September 30, 2016, the exchange rate registered MXN per U.S. dollar, while at the end of the third quarter of this year it registered MXN per U.S. dollar. This resulted in a total financial debt of MXN 1,928.4 billion, or USD billion. Approximately 85% of Petróleos Mexicanos financial debt is denominated in currencies different to the Mexican peso, mainly in U.S. dollars, and for registration purposes is converted into pesos at the exchange rate at the end of the period. As of September 30, 2017, Petróleos Mexicanos and PMI 10 carried out financing activities for MXN billion, or USD 29.7 billion. Total debt payments amounted to MXN billion, or USD 23.3 billion. PEMEX s financing strategy is intended to take advantage of financial markets with increased liquidity, maximize efficiencies with respect to reference curves, seize opportunities in select markets and maintain a diversified debt maturity profile. 10 Refers to P.M.I. Holdings, B.V., P.M.I. Norteamérica, S.A. de C.V., Pemex Finance Ltd and Pro-Agroindustria, S.A. de C.V. PEMEX Results Report as of September 30, / 28

21 201,442 (198,335) -2.8% Financial Debt (MXN billion) 1,983,171 (164,773) (6,086) 1,928, ,166 (226,322) 339, ,225 (146,123) PMI Debt Petroleos Mexicanos debt Short-Term Long-Term 1,782,293 1,819,638 1,807,005 1,736,191 Financial Debt as of December 31, 2016 Financing Activities Amortizations 1) Includes Finance Public Works Contracts Program. 2) Includes accrued interests and amortized cost. 1 Foreign Exchange Fluctuation Others 2 Financial Debt as of September 30, 2017 Cash & Cash Equivalents Net Debt 3Q17 Net Debt 2016 Financial Debt Exposure as of September 30, 2017 By currency 0.5% 0.3% 2.3% 15.0% U.S. dollars Mexican pesos Euros 18.0% By rate Fixed Floating 81.8% Yens UDIS 82.0% Average Duration of Financial Debt Exposure (years) Average: 4.8 Average: 5.3 Other Currencies 1.0 Other Currencies 15.2 MXN 2.6 MXN 2.7 USD 5.9 USD 5.7 As of September 30, 2017 PEMEX Results Report as of September 30, / 28

22 3.3 Investment Activities 2017 Activity As of September 30, 2017, PEMEX spent MXN billion (USD 7.7 billion 11 ) on investment activities, which represents 70.9% of the total investment budget of MXN billion that was programmed for the year. These investments were allocated as follows: Authorized Investment (MXN billion) Investment Expenditures As of September 30, 2017 (MXN billion) Exploration and Production Industrial Transformation Logistics Drilling and Services Corporate Ethylene Fertilizers Note: These figures include non-capitalizable maintenance Financing Activities Liquidity Management As of October 27, 2017, Petróleos Mexicanos holds five syndicated revolving credit lines for liquidity management in the amounts of USD 6.7 billion and MXN 23.5 billion. Of these lines, USD 5.4 billion and MXN 23.5 billion are available. 4. Other Relevant Information Affirmation of Credit Rating and Improvement in Credit Outlook New Fiscal Framework for Marginal Fields On August 3, 2017, Fitch Ratings affirmed Petróleos Mexicanos credit ratings 13 of BBB+ and modified its credit outlook to stable from negative. This was in line with the change in the Mexican sovereign debt s credit outlook to stable from negative. On August 18, 2017, the Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público, SHCP) established a new fiscal framework to provide financial feasibility to certain fields assigned to PEMEX that are profitable before taxes, but are not profitable under the current fiscal regime. This new legal framework increased the cost deductibility limits for the Profit-Sharing Duty as follows: 11 Convenience translation has been made at the established exchange average rate during the first nine months of 2017, of MXN = USD MXN 27.6 billion were allocated to exploration activities. 13 Long-term Foreign Currency Issuer Default Rating (IDR) at BBB+ and Long-term Local Currency Issuer Default Rating (IDR) at BBB+. PEMEX Results Report as of September 30, / 28

23 Type of Field Cost Deductibility Limits (as a percentage of income) Current New Framework Marginal Fields Onshore crude oil fields 20% 40% Shallow water oil fields 14% 35% Non-associated natural gas fields 80% 85% Chicontepec fields 60% 75% This measure aims to provide feasibility to an approximate crude oil production of 150 Mbd and up to 500 billion BTU of gas. Recent Appointment Divestiture of stake in Los Ramones On October 5, 2017, the Board of Directors of Petróleos Mexicanos approved the appointment of Guillermo Edmundo Bernal Miranda as General Director of Pemex Drilling and Services, Stateowned Productive Company and subsidiary of Petróleos Mexicanos, effective October 9, On October 6, 2017, PEMEX announced the divestiture of 50% of its stake in Ductos y Energéticos del Norte, S. de R.L. de C.V. which implies a 25% stake in Los Ramones II Norte pipeline. This stake was acquired by Infraestructura Energética Nova, S.A.B. de C.V. (IEnova) through an agreement, previous authorization of the Federal Economic Competition Commission (Comisión Federal de Competencia Económica, COFECE). The transaction amounts to approximately USD 231 million, which is among comparable companies valuation parameters and previous transactions in the hydrocarbons transportation and storage industry. It will be adjusted on the date the transaction takes place, acknowledging each party s rights and obligations. PEMEX Results Report as of September 30, / 28

24 5. Conference call Roberto Cejudo Deputy Director of Treasury Gustavo Hernández Director of Resources, Reserves & Associations of Exploration & Production Carlos Murrieta Director of Industrial Transformation will present the financial and operating results of PEMEX as of September 30, 2017 Friday, October 27, 2017 at 10:00 a.m. (CDT) / 11:00 a.m. (EDT) A question and answer session will follow the presentation. Participants will be able to ask questions via telephone and electronically via the webcast interface. Online Institutional Database Access PEMEX's official operating information database interactively. SEC Filings Review the latest 20-F, F-4 and 6-K forms filed by PEMEX with the SEC To connect through telephone, dial +1 (847) From U.S.A. and Canada, dial +1 (888) Conference passcode: To connect through Internet, access webcast. The teleconference and webcast replay will be available on October 27, 2017 at 1:00 p.m. (EDT) and until January 27, 2018 through this link. As of November 7, 2017, the conference call replay will be available at Unaudited Financial Results Additionally, the Spanish version of the conference call will take place at 11:00 a.m. (CDT) / 12:00 p.m. (EDT), please follow this link to find the instructions to connect: Información Financiera / Calendario financiero / Reporte de Resultados al 30 de septiembre de Investor Relations ri@pemex.com PEMEX Results Report as of September 30, / 28

25 6. Financial Statements Consolidated Income Statement PEMEX Third quarter (Jul.-Sep.) Change 2017 (MXN million) (USD million) Total sales 274, , % 56,354 18,208 Domestic sales 170, , % 42,865 11,726 Exports 101, , % 12,691 6,260 Services income 3,242 4, % Cost of sales 228, , % 40,810 14,800 Gross income 46,477 62, % 15,544 3,408 Other revenues (expenses) 25,754 2, % (22,756) 165 Transportation and distribution expenses 5,982 5, % (938) 277 Administrative expenses 27,974 30, % 2,431 1,671 Operating income (loss) 38,275 29, % (8,705) 1,625 Financial Cost (25,664) (27,358) -6.6% (1,694) (1,503) Financial Income 2,408 4, % 2, Income (cost) due to financial derivatives 4,839 4, % (189) 255 Foreign exchange profit (loss) (52,183) (28,426) 45.5% 23,757 (1,562) Profit sharing in non-consolidated subsidiaries and affiliates 1,445 (763) % (2,208) (42) Income before taxes and duties (30,882) (17,876) -42.1% 13,006 (982) Taxes and duties 87,442 83, % (3,510) 4,612 Profit Sharing Duties 81,858 85, % 3,988 4,717 Income tax and other 5,584 (1,913) % (7,497) (105) Net income (loss) (118,323) (101,808) 14.0% 16,516 (5,594) Other comprehensive results 4,483 (711) % (5,194) (39) Investment in equity securities 223 1, % Conversion effect 4,260 (1,861) 143.7% (6,121) (102) Comprehensive income (loss) (113,840) (102,519) 9.9% 11,322 (5,634) PEMEX Results Report as of September 30, / 28

26 Consolidated Balance Sheet PEMEX As of December 31, As of September 30, (MXN million) Change 2017 (USD million) Total assets 2,329,886 2,235, % (94,121) 122,858 Current assets 355, , % 15,965 20,407 Cash and cash equivalents 163, , % (17,410) 8,030 Accounts, notes receivable and other 133, , % 11,646 7,961 Inventories 45,892 57, % 11,724 3,166 Available non-current assets kept for sale 7,461 2, % (4,746) 149 Available for sale financial assets % - - Derivative financial instruments 4,857 20, % 15,187 1,101 Permanent investment in shares of associates 23,155 17, % (5,364) 978 Property, plant and equipment 1,667,742 1,569, % (98,146) 86,251 Deferred taxes 100,325 97, % (3,294) 5,332 Restricted cash 10, % (10,479) - Other assets 166, , % 6,092 9,498 Available for sale financial assets 6,028 7, % 1, Total liabilities 3,562,894 3,459, % (103,624) 190,092 Current liabilities 426, , % (60,017) 20,122 Short-term financial debt 176, , % 16,059 10,563 Suppliers 151,650 93, % (57,873) 5,153 Accounts and accrued expenses payable 18,667 24, % 5,760 1,342 Derivative financial instruments 30,868 11, % (19,430) 629 Taxes and duties payable 48,840 44, % (4,533) 2,435 Long-term liabilities 3,136,704 3,093, % (43,606) 169,970 Long-term financial debt 1,807,005 1,736, % (70,814) 95,406 Reserve for employee benefits 1,220,409 1,264, % 43,601 69,459 Reserve for diverse credits 88,318 74, % (14,069) 4,080 Other liabilities 16,838 14, % (2,156) 807 Deferred taxes 4,135 3, % (168) 218 Total equity (1,233,008) (1,223,505) -0.8% 9,503 (67,233) Holding (1,233,985) (1,224,434) -0.8% 9,550 (67,284) Certificates of contribution "A" 356, , % - 19,593 Federal Government Contributions 43,731 43, % - 2,403 Legal Reserve 1,002 1, % - 55 Comprehensive accumulated results (163,399) (172,748) -5.7% (9,348) (9,493) Retained earnings (accumulated losses) (1,471,863) (1,452,964) -1.3% 18,899 (79,842) From prior years (1,280,217) (1,471,863) -15.0% (191,646) (80,881) For the year (191,646) 18, % 210,544 1,039 Participation of non-holding entities % (47) 51 Total liabilities and equity 2,329,886 2,235, % (94,121) 122,858 PEMEX Results Report as of September 30, / 28

27 Consolidated Statements of Cash Flows Operating activities Change 2017 (MXN million) (USD million) Net income (loss) (263,802) 18, % 282,710 1,039 Items related to investing activities 2, , % 145,755 8,130 Depreciation and amortization 93, , % 16,720 6,042 Impairment of properties, plant and equipment (99,036) 36, % 135,517 2,005 Unsuccessful wells 24,713 4, % (20,455) 234 Retirement of property, plant and equipment 3,288 3, % Profit from acquisition of businesses (5,579) % 5,579 - Profit in the sale of associates (15,211) % 15,211 - Effects of non-consolidated subsidiaries and affiliates (734) (112) -84.7% 621 (6) Dividend revenue (128) (181) 41.1% (53) (10) Effects of net present value of reserve for well abandonment 1,664 (5,828) % (7,491) (320) Activities related to financing activities 240,576 (89,963) % (330,539) (4,944) Amortization of primes, discounts, profits and debt issuance expenses (876) (2,160) 146.6% (1,284) (119) Interest expense (income) 68,811 76, % 8,160 4,230 Unrealized loss (gain) from foreign exchange fluctuations 172,641 (164,773) % (337,414) (9,055) Subtotal (21,025) 76, % 97,926 4,226 Funds provided by (used in) operating activities (48,242) (77,289) 60.2% (29,047) (4,247) Financial instruments for negotiation (13,782) (34,617) 151.2% (20,836) (1,902) Accounts and notes receivable (40,686) (13,405) -67.1% 27,281 (737) Inventories (526) (11,724) % (11,197) (644) Long term accounts and notes receivable - (4,021) # DIV/0! (4,021) (221) Intangible assets - 95 # DIV/0! 95 5 Other assets (4,896) (5,419) 10.7% (523) (298) Accounts payable and accrued expenses 7,930 5, % (2,170) 317 Taxes paid (5,289) 7, % 12, Suppliers (43,360) (57,873) 33.5% (14,513) (3,180) Reserve for diverse credits 5,178 (10,338) % (15,515) (568) Reserve for employees benefits 48,019 43, % (4,418) 2,396 Deferred taxes (829) 3, % 3, Net cash flow from operating activities (69,267) (388) -99.4% 68,879 (21) Investing activities Acquisition of property, plant and equipment (90,874) (43,781) -51.8% 47,093 (2,406) Exploration expenses (15,015) (1,005) -93.3% 14,010 (55) Resources from divestment of financial assets Resources from divestment of fixed assets 22, % (22,685) - Acquisition of businesses (3,909) % 3,909 - Net cash flow from investing activities (87,113) (44,102) -49.4% 43,011 (2,423) Cash needs related to financing activities (156,380) (44,490) -71.5% 111,890 (2,445) Financing activities PEMEX As of September 30, Increase of contributions from the Federal Government 73, (73,500.0) - Loans obtained from financial institutions 556, , % (15,715) 29,716 Amortization of loans (317,463) (424,657) 33.8% (107,195) (23,336) Interest paid (67,476) (80,896) 19.9% (13,420) (4,445) Net cash flow from financing activities 245,037 35, % (209,830) 1,935 Net Increase (decrease) in cash and cash equivalents 88,657 (9,283) 110.5% (97,940) (510) Effect of change in cash value 10,852 (8,127) % (18,980) (447) Cash and cash equiv. at the beginning of the period 109, , % 54,164 8,986 Cash and cash equivalents at the end of the period 208, , % (62,756) 8,030 PEMEX Results Report as of September 30, / 28

28 If you would like to be included in our distribution list, please the Investor Relations team at or register on If you would like to contact us, please call us at (52 55) , (52 55) , (52 55) or send an to Follow us Jaime del Rio Castillo Lucero Medina González Mariana López Martínez José González Echevarría Guillermo Bitar Siman Alejandro López Mendoza Variations Cumulative and quarterly variations are calculated comparing the period with the same one of the previous year; unless specified otherwise. 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, 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 or affiliates of Petróleos Mexicanos. It is important to mention, that our current financing agreements do not include financial covenants or events of default that would be triggered as a result of our having negative equity. Methodology We might change the methodology of the information disclosed in order to enhance its quality and usefulness, and/or to comply with international standards and best practices. Foreign Exchange Conversions Convenience translations into U.S. dollars of amounts in Mexican pesos have been made at the exchange rate at close for the corresponding period, unless otherwise noted. Due to market volatility, the difference between the average exchange rate, the exchange rate at close and the spot exchange rate, or any other exchange rate used could be material. Such translations should not be construed as a representation that the Mexican peso amounts have been or could be converted into U.S. dollars at the foregoing or any other rate. It is important to note that we maintain our consolidated financial statements and accounting records in pesos. As of September 30, 2017, the exchange rate of MXN = USD 1.00 is used. Fiscal Regime Starting January 1, 2016, Petróleos Mexicanos fiscal regime is ruled by the Ley de Ingresos sobre Hidrocarburos (Hydrocarbons Income Law). Since January 1, 2006 and until December 31, 2015, PEP was subject to a fiscal regime governed by the Federal Duties Law, while the tax regimes of the other Subsidiary Entities were governed by the Federal Revenue Law. The Special Tax on Production and Services (IEPS) applicable to automotive gasoline and diesel is established in the Production and Services Special Tax Law Ley del Impuesto Especial sobre Producción y Servicios. As an intermediary between the Ministry of Finance and Public Credit (SHCP) and the final consumer, PEMEX retains the amount of the IEPS and transfers it to the Mexican Government. The IEPS rate is calculated as the difference between the retail or final price, and the producer price of products. If the final price is higher than the producer price, the IEPS is paid by the final consumer. If the opposite occurs, the negative IEPS amount can be credited against certain of PEMEX s tax liabilities and included in Other income (expenses) in its Income Statement. PEMEX s producer price is calculated in reference to that of an efficient refinery operating in the Gulf of Mexico. Until December 31, 2017, the Mexican Government may continue issuing pricing decrees to regulate the maximum prices for the retail sale of gasoline and diesel fuel, taking into account transportation costs between regions, inflation and the volatility of international fuel prices, among other factors. Beginning in 2018, the prices of gasoline and diesel fuel will be freely determined by market conditions. However the Federal Commission for Economic Competition, based on the existence of effective competitive conditions, can declare that prices of gasoline and diesel fuel are to be freely determined by market conditions before Hydrocarbon Reserves In accordance with the Hydrocarbons Law, published in the Official Gazette of the Federation on August 11, 2015, the National Hydrocarbons Commission (CNH) will establish and will manage the National Hydrocarbons Information Center, comprised by a system to obtain, safeguard, manage, use, analyze, keep updated and publish information and statistics related; which includes estimations, valuation studies and certifications. 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 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; activities relating to the generation of electrical energy; 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; our ability to find, acquire or have the right to access additional hydrocarbons reserves and to develop the reserves that we obtain successfully; 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 laws that implement the new legal framework contemplated by the Energy Reform Decree (as described in our most recent Annual Report and Form 20-F); developments affecting the energy sector; and changes in our legal regime or regulatory environment, including tax and environmental regulations. Accordingly, you should not place undue reliance on these forward-looking statements. In any event, these statements speak only as of their dates, and we undertake no obligation to update or revise any of them, whether as a result of new information, future events or otherwise. These risks and uncertainties are more fully detailed in our most recent Annual Report filed with the CNBV and available through the Mexican Stock Exchange ( and our most recent Form 20-F filing filed with the SEC ( These factors could cause actual results to differ materially from those contained in any forward-looking statement. PEMEX Results Report as of September 30, / 28