Comisión Federal de Electricidad (A Decentralized Public Entity of the Federal Government)

Transcription

1 Comisión Federal de Electricidad (A Decentralized Public Entity of the Federal Government) Financial Statements for the Years Ended December 31, 2002 and 2001, and Independent Auditors Report

2 Comisión Federal de Electricidad (A Decentralized Public Entity of the Federal Government) TABLE OF CONTENTS Page INDEPENDENT AUDITORS REPORT 1 and 2 FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001: Balance sheets 3 Statements of operations 4 Statements of changes in equity 5 Statements of changes in financial position 6 Notes to the financial statements 8

3 INDEPENDENT AUDITORS' REPORT To the Department of Controllership and Administrative Development and the Board of Governance of Comisión Federal de Electricidad: We have audited the accompanying balance sheet of Comisión Federal de Electricidad (a Decentralized Public Entity of the Federal Government) (the "Entity") as of December 31, 2002, and the related statements of operations, changes in equity and changes in financial position for the year then ended, stated in thousands of Mexican pesos of purchasing power of December 31, These financial statements are the responsibility of the Entity's management. Our responsibility is to express an opinion on these financial statements based on our audit. The financial statements of the Entity as of December 31, 2001 and for the year then ended were audited by other auditors, who expressed an unqualified opinion in their report dated March 20, 2002, before the restatement explained in the third paragraph below. We conducted our audit in accordance with auditing standards generally accepted in Mexico. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and that they are prepared in accordance with accounting principles generally accepted in Mexico. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As mentioned in Note 3 to the financial statements, separate financial statements have been prepared and issued for use in the preparation and integration of the Federal Public Treasury account. Up to December 31, 2001, the entity had adopted that set forth in Financial Information Standard ("NIF") 09 A, "Rule for the Accounting Treatment of Investments in Long-Term Productive Infrastructure (PIDIREGAS)", issued jointly by the Secretariat of Finance and Public Credit and the Secretariat of Controllership and Administrative Development, which is contained in the General Public Debt Law (Article 18) and the Law on Federal Public Budget, Accounting and Spending (Article 30), and establishes certain accounting rules for the treatment of the investments and liabilities mentioned in the regulations. Based on such regulations, the Entity had recorded the liability which will be due within two years of the balance sheet date and recognized the asset for the same amount, while the assets and liabilities whose recording was deferred to subsequent years were reported in memoranda accounts. Accounting principles generally accepted in Mexico require the accounting recognition of all investments made and liabilities contracted. Consequently, to reflect all investments made and all contracted liabilities, and report better financial information, beginning January 1, 2002 the Entity recognizes the previously deferred assets and liabilities, with the primary impact of an increase in plants, installations and equipment of $30,565,601 thousand, with a corresponding increase in long-term liabilities. Furthermore, the financial statements of the prior year have been restated to make them comparable with those of the year ended December 31, 2002.

4 In our opinion, such 2002 financial statements present fairly, in all material respects, the financial position of Comisión Federal de Electricidad as of December 31, 2002, and the results of its operations, changes in its equity and changes in its financial position for the year then ended in conformity with accounting principles generally accepted in Mexico. The accompanying financial statements have been translated into English for the convenience of users. Galaz, Yamazaki, Ruiz Urquiza, S.C. C.P.C. Arturo García Bello March 20,

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6 COMISION FEDERAL DE ELECTRICIDAD (A Decentralized Public Entity of the Federal Government) STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001 (In Thousands of Mexican Pesos of Purchasing Power of December 31, 2002) REVENUES FROM ENERGY SALES $ 118,116,065 $ 107,088,155 COSTS AND EXPENSES: Exploitation 78,880,531 77,260,673 Depreciation Administrative expenses 18,499,014 3,533,894 17,600,747 3,078,678 Actuarial cost of employee retirement obligations for the year (Note 12) 12,198,061 9,781, ,111, ,721,338 OPERATING INCOME (LOSS) 5,004,565 (633,183) NET COMPREHENSIVE FINANCING COST: expense, net (4,258,561) (4,800,225) Foreign exchange gain (loss), net (8,558,227) 3,282,479 Monetary position gain 783,736 (12,033,052) 1,176,411 (341,335) OTHER INCOME (EXPENSES), Net (Note 16) (437,565) 2,050,649 INCOME TAX ON DISTRIBUTABLE REMNANT (Note 17) (554,921) (500,205) OPERATING INCOME (LOSS) BEFORE PROFITS AND TRANSFERS (8,020,973) 575,926 Duties (Notes 3 and 13) (39,986,248) (40,711,808) Non-cash transfers from the Federal Government to supplement deficient rates (Notes 3 and 13) 42,491,547 46,636,542 Benefit from non-cash transfers from the Federal Government to supplement deficient rates (Notes 3 and 13) 2,505,299 5,924,734 NET INCOME (LOSS) $ (5,515,674) $ 6,500,660 See accompanying notes to financial statements. -4-

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8 COMISION FEDERAL DE ELECTRICIDAD (A Decentralized Public Entity of the Federal Government) STATEMENTS OF CHANGES IN FINANCIAL POSITION FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001 (In Thousands of Mexican Pesos of Purchasing Power of December 31, 2002) OPERATING ACTIVITIES: Net income (loss) $ (5,515,674) $ 6,500,660 Items that did not required (generated) resources: Depreciation 18,499,014 17,600,747 Actuarial cost of employee retirement obligations for the year, net 12,198,061 9,781,240 Other long-term liabilities 124,599 18,682 Benefit from non-cash transfer from the Federal Government to supplement deficient rates (2,505,299) (5,924,734) 22,800,701 27,976,595 Changes in operating assets and liabilities: (Increase) decrease in: Consumers and other debtors, net (2,786,233) (704,456) Luz y Fuerza del Centro (1,512,843) (843,068) Recoverable value-added tax 335,440 (219,665) Materials for operations, net (1,669,390) 150,935 Employee loans (25,156) (105,106) Increase (decrease) in: Suppliers and contractors (977,559) (1,564,282) Taxes and fees payable 9, ,467 Value-added tax payable 879,546 - Other accounts payable and accrued liabilities (399,725) 818,864 Deposits from users and contractors 584, ,604 Employee retirement obligations (3,901,353) (3,483,349) (9,463,968) (5,143,056) Net cash provided by operating activities 13,336,733 22,833,539 FINANCING ACTIVITIES: Increase (decrease) in debt in nominal pesos 795,888 (1,317,117) Decrease in debt in constant pesos (1,143,283) (1,069,939) Increase in capital lease obligations and PIDIREGAS in nominal pesos 6,846,611 2,968,114 Decrease in capital lease obligations and PIDIREGAS in constant pesos (2,348,299) (1,608,824) Contributions received 2,875,990 2,523,603 Net cash provided by financing activities 7,026,907 1,495,837-6-

9 INVESTING ACTIVITIES: Additions to plants, installations and equipment, less net book value of retirements (14,704,349) (26,883,125) (Increase) decrease in other assets (3,388,345) 783,394 Net cash used in investing activities (18,092,694) (26,099,731) CASH AND TEMPORARY INVESTMENTS: Net increase (decrease) 2,270,946 (1,770,355) Cash and temporary investments at beginning of the year 15,681,775 17,452,130 Cash and temporary investments at end of the year $ 17,952,721 $ 15,681,775 Ing. Alfredo Elías Ayub General Director Lic. Francisco J. Santoyo Vargas Finance Director C.P. Conrado Villalobos Díaz Deputy-director of Finance Control C.P. Oscar H. Lara Andrade Accounting Manager See accompanying notes to financial statements. -7-

10 COMISION FEDERAL DE ELECTRICIDAD (A Decentralized Public Entity of the Federal Government) NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001 (In Thousands of Mexican Pesos of Purchasing Power of December 31, 2002) 1. OPERATIONS AND INCORPORATION Comisión Federal de Electricidad ("CFE" or "the Entity") is a Decentralized Public Entity of the Federal Government of a technical, industrial and commercial nature, created by a Decree issued by Congress (Legislative Branch) on August 14, 1937, published in the Federal Official Gazette ( DOF") on August 24, 1937 (which repealed the Decree issued by Congress on December 29, 1933, published in the DOF on January 29, 1934), with its own legal identity and equity. The Entity mainly renders public electric energy service throughout the Mexican national territory, which consists of: generating, conveying, transforming, distributing, and supplying electric energy, as well as planning and carrying out all the projects, installations, and jobs required by the national electricity system with respect to planning, execution, operation, and maintenance, with the applicable participation of independent energy producers, as provided for in the terms set forth in the Public Electric Energy Service and its Regulations. The responsibility for rendering public electric energy service is shared by CFE with another Decentralized Public Entity of the Federal Government, referred to as Luz y Fuerza del Centro ( LFC ), which handles the distribution and sale of all types of power consumed, mainly in the metropolitan area of Mexico City and some neighboring states and, to a lesser degree, certain activities related to energy generation and transportation. Approximately 95% of the energy distributed and marketed by LFC in its area of influence is bought from CFE. The rates applicable to electric power sales in Mexico are defined and authorized by the Federal Government, through the Department of Revenues of the Secretariat of Finance and Public Credit ( SHCP ). 2. BASIS FOR PRESENTATION a. Comprehensive loss- Comprehensive loss presented in the accompanying statement of changes in equity is comprised of the net income (loss) of the year, plus other comprehensive income (loss) items of the same period which, in accordance with accounting principles generally accepted in Mexico ( MEXGAAP ), are presented directly in equity without affecting the statements of operations (Note 15). b. Reclassifications- Certain amounts in the financial statements as of and for the year ended December 31, 2001 have been reclassified to conform to the presentation of the financial statements as of and for the year ended December 31,

11 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies followed by the Entity are in accordance with MEXGAAP, which require the Entity's management to make certain estimates and assumptions to determine the valuation of certain items included in the financial statements and to make the appropriate necessary disclosures therein. Although actual results may differ from such estimates, the Entity's management believes that the estimates and assumptions used were adequate under the circumstances. The principal accounting policies followed by the Entity are as follows: a. Change in accounting policy Until December 31, 2001, the Entity followed the accounting set forth in Financial Information Standard ( NIF ) 09 A, "Rule for the Accounting Treatment of Investments in Long-Term Productive Infrastructure (PIDIREGAS)", issued jointly by the SHCP and the Secretariat of Controllership and Administrative Development ( SECODAM ), which is contained in the General Public Debt Law (Article 18) and the Law on Federal Public Budget, Accounting and Spending (Article 30), and establishes certain accounting rules for the treatment of the investments and liabilities mentioned in the regulations. On the basis of such regulations, the entity has recorded the liability which will be due within two years of the balances sheet date and recognized the asset for the same amount, while the assets and liabilities whose recording was deferred to subsequent years were reported in memoranda accounts. MEXGAAP requires the accounting recognition of all investments made and liabilities contracted. Consequently, to reflect the investments made and liabilities contracted, and obtain better financial information, beginning January 1, 2002 the Entity recognizes the previously deferred assets and liabilities, which mainly results in an increase in plants, installations and equipment for $30,565,601, with the same amount added to long-term liabilities. Furthermore, the 2001 financial statements have been restated to make them comparable with those of the year ended December 31, Separate financial statements in Spanish have been prepared and issued for use in the preparation and integration of the Federal Public Treasury account. b. Recognition of the effects of inflation The CFE restates its financial statements in terms of Mexican pesos of purchasing power of the date of the last balance sheet presented, thus recognizing the effects of inflation in financial information. Consequently, the prior year financial statements presented have also been restated in terms of the same purchasing power, and their figures differ from those originally presented, which were in Mexican pesos of purchasing power of the close of that year. For this reason, the figures of the accompanying financial statements are comparable because they are all expressed in constant Mexican pesos. c. Cash and temporary investments - This item consists of cash, deposits and short-term investments, which are stated at market value. d. Materials for operation and cost of consumption - Inventories of materials for operation are recorded originally at average acquisition cost and the related final monthly balances, and consumptions are restated using the National Consumer Price Index ( NCPI ). Materials in transit are valued at acquisition cost. -9-

12 e. Plants, installations and equipment - These assets are recorded at acquisition and/or construction cost, including the following items as part of cost: administrative expenses of corporate directly related to the construction and installation of assets, costs of retirements and seniority premium for full-time employees on construction sites, and depreciation of the equipment used in the construction and installation of the assets. Up to December 31, 1996 the assets were restated annually to replacement cost by using capital price indexes of the electric utility industry, determined by CFE specialized experts. As of January 1, 1997, such assets, as well as those acquired after that date, are restated by the method of adjustments to historical costs for changes in general price levels, using NCPI inflation factors, based on the replacement values determined at the end of 1996 and the acquisition and/or construction cost of those acquired after that date. Depreciation of plants, installations and equipment in operation is calculated based on restated values under the straight-line method, starting as of the date on which the assets are placed in operation, using depreciation rates based on the estimated useful lives of the assets, determined by CFE specialized technicians, as follows: Annual Rate % Geothermal power plants From 2 to 3.70 Steam generating power plants From 1.33 to 2.86 Hydroelectric power plants From 1.25 to 2.50 Internal combustion power plants From 1.33 to 3.03 Gas turbine and combined cycle power plants From 1.33 to 3.03 Nuclear power plant From 1.33 to 2.86 Substations From 1.33 to 2.56 Transmission lines From 1.33 to 2.86 Distribution networks From 1.67 to 3.33 The buildings and assets used for offices and general services are depreciated based on the rates authorized in the Income Tax Law. f. Derivative financial instruments - The internal control system established by CFE includes the practice of managing its exchange rate risk exposure by using financial instrument hedges. These financial instruments are contracted only with recognized institutions. The CFE does not have the practice of performing transactions with financial instruments for speculative purposes. Currently the CFE has contracted only one financial instrument hedge, which basically reduces its exposure to exchange rate fluctuations on the bond for 32,000,000,000 Japanese yen (see Note 11b). The CFE values financial instrument hedges using the same valuation criteria for the financial liabilities being hedged, and the effects of such evaluation are recognized in results, net of costs, expenses and revenues from the assets or liabilities whose risks are being hedged. The financial assets generated by the hedge instruments are presented in the balance sheet as a reduction of those liabilities whose risks are being hedged (see Note 11b). -10-

13 g. Other long-term liabilities - In accordance with federal regulations, when a nuclear power plant terminates its operations (due to expiration of licenses), it must be dismantled for security and environmental protection reasons. For this purpose, a technical-economic study was performed to assess the estimated cost in this regard, based on the electric power output of the Laguna Verde nuclear power plant, whose distribution is standardized over its useful life by recording a monthly provision in books that is charged to results for each year. h. Employee retirement obligations- Employee retirement obligations are recorded as accrued, and are calculated by independent actuaries based on the projected unit credit method using real interest rates. As a result, the liability is being recognized, which at present value is estimated will cover the obligation derived from these benefits at the estimated retirement date of the Entity's employees. Severance is charged to results when the liability is determined to be payable. i. Recognition of revenues - Revenues are recognized in the period in which energy sales are made to customers. On February 7, 2002, the DOF published the agreement authorizing the adjustment, modification and restructuring of the appropriate rates for the supply and sale of electric power in Mexico, establishing the mechanism to reduce the subsidies granted to household service at the highest consumption levels. This measure had a positive impact on revenues from energy sales for the year ended December 31, j. Unbilled energy sold- Energy that has been delivered and is in the process of being billed is treated as revenue for the year and its amount is estimated based on the actual billing of the immediately preceding bimester. k. Transactions in foreign currency- Transactions in foreign currency are recorded at the exchange rate in effect at the transaction date, and monetary assets and liabilities in foreign currency are adjusted in Mexican pesos at the exchange rate in effect at the close of the year, affecting results as part of net comprehensive financing cost. l. Transactions with Federal, State and Municipal governments - The principal transactions performed with Federal, State and Municipal governments and the respective accounting treatment, are as follows: Federal Government: Duties- In accordance with Article 46 of the Electric Utility Public Service Law, effective December 23, 1992, the CFE is required to pay a fee to the Federal Government for the assets it uses to render the electric utility public service. Duties are determined annually based on the profitability rate established for state owned entities in each year; for 2002 and 2001 the rate was 9%, which was authorized by the SHCP. Such rate is applied to the value of the net operating assets of the immediately preceding year and the resulting amount is charged to results of the year. -11-

14 The annual duty expense is compared with the non-cash transfers to supplement deficient rates (subsidy), and the difference is applied to equity. Up to 1999 a net liability had been generated in favor of the Federal Government, which was not payable, but was capitalized in equity at the close of each year. However, since fiscal 2000 the amount utilized has been below that of the subsidy, with the insufficiency directly affecting the Entity s equity (see Note 15). Transfers to supplement deficient rates - This item refers to resources that the Federal Government grants to users of the electric power service through the CFE by applying subsidized rates for energy sales. A significant part of these transfers is treated as non-cash transactions, because under the current Electric Power Public Service Law, such transactions are credited against the duties payable by the Entity. During 2002 and 2001, CFE only recorded non-cash transfers, because it did not receive any cash transfers. These transfers are credited to results of the year in which they are presented and are shown in the statements of operations. State and Municipal Governments: Contributions- The contributions received from Federal, State and Municipal governments for the electrification of rural settlements and low-income districts, and from private parties to expand the distribution network, are recorded as an increase in equity. m. Restatement of equity- Given that the equity of CFE consists of contributions received and results obtained which are capitalized each year and decreased due to withdrawals from equity, the restatement of these different components was determined by indexing the original amounts, based on the contribution dates used to prepare the results, as well as the respective withdrawal dates, in order to present figures in pesos of purchasing power equivalent to December 2002 using NCPI inflation factors. n. Insufficiency in restatement of equity- This item represents the difference between the restatement of fixed assets based on specific costs and the restatement of the different components of equity by applying NCPI factors. The effects recorded in this account during 2002 and 2001 represent the net decrease in fixed assets acquired under the PIDIREGAS programs, which are restated based on the movement of the exchange rate, equivalent to specific cost, compared to the restatement obtained by restating the assets in accordance with NCPI factors. Also, during 2002 the CFE finished the analysis and adjustment of the records of its plants, installations and equipment, which resulted in a correction to the restatement adjustment of $5,320,294, recorded directly in equity as part of the effect for the year (see Note 15). o. Net comprehensive financing cost- Net comprehensive financing cost includes all financial revenue or expense items, such as interest, exchange results and monetary position result, as they are accrued. p. Monetary position gain- Monetary position gain, which represents the effects of inflation on the purchasing power of monetary items, is determined by applying the NCPI inflation factor to the net monetary liability at the start of each month, and is restated at the close of the year by applying the respective factor. q. Statement of changes in financial position- The statements of changes in financial position present the changes in constant currency, based on the financial position at the close of the prior year, restated to Mexican pesos of the close of the latest year. -12-

15 4. CASH AND TEMPORARY INVESTMENTS At December 31, 2002 and 2001, cash and temporary investments are as follows: Cash $ 3,890,898 $ 3,521,514 Temporary investments 14,061,823 12,160,261 $ 17,952,721 $ 15,681, CONSUMERS AND OTHER DEBTORS At December 31, 2002 and 2001, these accounts and notes receivable are summarized below: Public consumers $ 7,999,847 $ 6,783,522 Government consumers 1,601, ,055 Energy sold in the process of being billed 6,201,352 5,357,734 15,803,134 13,047,311 Other debtors 1,982,654 1,817,751 17,785,788 14,865,062 Less- Allowance for doubtful accounts (819,872) (685,379) $ 16,965,916 $ 14,179, LUZ Y FUERZA DEL CENTRO ("LFC") The balances of the receivable from LFC at December 31, 2002 and 2001 amounting to $3,025,860 and $1,513,017, respectively, are derived from transactions carried out between that entity and CFE, in accordance with the energy buy and sell agreement entered into by both parties. During the years ended December 31, 2002 and 2001 transactions between these entities that affected the income of CFE were as follows: Sales of energy to LFC $ 21,542,091 $ 20,900,203 Exploitation cost and expenses- purchases of energy from LFC $ 506,957 $ 578,

16 7. MATERIALS FOR OPERATION As of December 31, 2001 and 2000, materials for operations, including their restatement, are as follows: Spare parts and equipment $ 10,593,680 $ 9,415,219 Fuel and lubricants 3,278,928 2,780,477 Nuclear fuel 1,223,266 1,158,989 Materials in transit 98,303 88,441 15,194,177 13,443,126 Less-Reserve for obsolete inventories (254,992) (173,331) $ 14,939,185 $ 13,269, PLANTS, INSTALLATIONS AND EQUIPMENT Balances of plants, installations and equipment at December 31, 2001 and 2000 are as follows: Plants, installations and equipment in operation $ 487,083,237 $ 481,677,677 Construction-in-progress 16,280,734 20,272,550 Materials for construction 5,414,817 13,841,872 $ 508,778,788 $ 515,792,099 Plants, installations and equipment in operation - The balances of plants, installations and equipment in operation at December 31, 2002 and 2001 are summarized as follows: Plants: Steam $ 220,133,765 $ 206,020,485 Hydroelectric 132,926, ,963,899 Transformation substation 115,893, ,585,819 Distribution networks 94,624,898 88,692,913 Transmission lines 69,191,490 85,999,520 Administrative buildings and other 61,079,416 24,944,909 Nuclear 51,303,246 51,713,489 Gas turbine and combined cycle 43,505,078 40,536,119 Geothermal 12,892,850 12,470,928 Internal combustion 3,949,120 3,789,220 Land 222, ,631 Other 45,273 35, ,768, ,969,062 Less- Accumulated depreciation (318,684,840) (264,291,385) $ 487,083,237 $ 481,677,

17 In recent years, due to the reduction in annual budgets, the CFE has not fully complied with the required maintenance, which might affect the estimated useful life of certain plants, installations and equipment. Construction in progress- The balances of construction-in-progress at December 31, 2002 and 2001 are as follows: Plants: Geothermal $ 313,662 $ 1,019,876 Steam 4,444,779 7,112,431 Hydroelectric 43,974 2,448,359 Internal combustion 5,430 5,491 Gas turbine and combined cycle 7, ,536 Transformation substation 2,656,886 2,155,186 Transmission lines 6,028,464 3,418,262 Distribution networks 1,322,819 2,452,926 General offices and installations 295, ,156 Advances for construction 1,162, ,327 Total $ 16,280,734 $ 20,272,550 During the years ended December 31, 2002 and 2001, the items capitalized in construction-inprogress in accordance with the policy described in Note 3e were $1,171,363 and $1,912,819, respectively ($538,309 and $1,098,929 of administrative expenses, $80,105 and $68,953 of depreciation, and $552,949 and $744,937 of increase to the provision for retirement and seniority premiums in 2002 and 2001, respectively). Materials for construction- The balances of materials for construction at December 31, 2002 and 2001, including restatement, are summarized below: Spare parts and equipment $ 5,262,820 $ 13,263,874 Materials in the possession of third parties 151, ,457 Equipment in transit ,541 $ 5,414,817 $ 13,841, TAXES AND FEES PAYABLE Taxes and fees payable at December 31, 2002 and 2001 are as follows: Payable by CFE: Income tax on the distributable remnant $ 540,469 $ 490,301 Income tax payable on account of third parties 276, ,689 Contributions to the National Workers Housing Fund 8,316 7,608 2% on salaries 12,989 9,836 Contributions to the Mexican Social Security Institute (includes Retirement Insurance) 256, ,558 Fees for the use of national waters 252, ,171 Subtotal 1,346,830 1,395,

18 Withheld by CFE: Tax on employee salaries 166, ,097 Income tax on foreign residents 5,911 1, % on contractors 11,338 4, % on contractors Income tax on fees and leases 3,872 3,740 Public lighting fees 103,716 94,748 Value-added tax 46,682 31,708 Other Subtotal 338, ,470 Total $ 1,685,796 $ 1,676, EQUIPMENT LEASED The debt applicable to the acquisition of plants, installations, and equipment through capital leases at December 31, 2002 and 2001, discussed in Note 8, is summarized as follows: -16-

19 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Rates Payments Equal to Yields Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency Asset Type Equipment Value Utilized Principal Payments at Dec 2002 Contract Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term ASSETS IN COMMERCIAL OPERATION Sale and lease with eventual return 250 million U.S. dollars 8.125% annual million U.S. dollars million U.S. dollars Principal Until 2003 $ 2,578,125.0 $ - 250, $ - $ 2,415, ,000.0 of Petacalco STEAM GENERATOR with semiannual maturity (A single final payment) units 3 and 4, and Topolobampo Units 1 and 2 until December 2003 and Commissions $1,961.4 million (190.2 million U.S. dollars Fiduciary fees $40.4 million $34.7 million 2 Integral Thermo-electric units million euros 2%, 10.15%, 11.78% 18.8 million euros Variable semiannual Principal Until , , , , , , , ,696.2 with 350 MW capacity each and 5.4% payments $262.9 million for C.T. TUXPAN Units 3 and 4 (24.3 million euros) and Commissions $57.3 million (5.3 million euros) Fiduciary fees $65.1 million Until 2021 $ million 2 Integral Thermo-electric units 68,681.4 million 27% and 7.3% 31,389.4 million Variable semiannual Principal Until , ,978, , , ,978, ,978,924.0 with 350 MW capacity each Japanese yen Japanese yen payments $5,414.1 million for C.T. PETACALCO Units 3 and 4 (62,302.5 million Japanese yen) and Commissions $2,593.6 million (30,996.9 million Japanese yen) and Commissions $423.0 million 2 Integral Thermo-electric units 91,492.6 million Long-term prime rate 36,267.6 million million Principal Until , , ,467, ,467, , ,247, ,467, ,934,935.4 with 350 MW capacity each Japanese yen reviewable semiannual Japanese yen Japanese yen $6,657.2 million for C.T. PETACALCO, Units 5 and 6 in Japanese yen each half year (76,607.7 million plus 0.5% and Japanese yen) annual 7.6% rate and Commissions $3,034.9 million (34,924.4 million Japanese yen) Fiduciary fees $ 98.4 million $78.7 million 2 Integral Thermo-electric units 6,118.3 million 7.30% % 2,743.5 million million Principal Until , , , , , , , ,052,740.3 with 160 MW capacity each Japanese yen Japanese yen Japanese yen $440.2 million one each for C.T. TOPOLOBAMPO each half year (5,065.6 million II Units 1 and 2 Japanese yen) and Commissions $229.9 million (2,645.8 million Japanese yen) million U.S. dollars 2.75%, 8.46%, 8.00% million U.S. dollars Variable Principal Until , , , , , ,526, , , %, 8.6% LIBOR $2,965.9 million , % and (287.6 million 7.30% U.S. dollars) and Commissions $2,182.1 million (211.6 million U.S. dollars) Fiduciary fees $ million $340.8 million 2 Integral hydroelectric units million U.S. dollars 9% million U.S. dollars Variable semiannual Principal Until , ,121, , , , ,588, , ,835.0 with 211 MW capacity each payments $2,153.3 million for P.H. HUITES (208.8 million U.S. dollars) and Commissions $2,373.9 million (230.2 million U.S. dollars)

20 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Rates Payments Equal to Yields Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency Asset Type Equipment Value Utilized Principal Payments at Dec 2002 Contract Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term 2 Integral thermoelectric units million U.S. dollars Variable and 8.41% million U.S. dollars Variable semiannual Principal Until , ,468, , , , ,012, , ,737.9 with 350 MW capacity each payments $5,727.6 million for C.T. TUXPAN Units 5 and 6 (555.4 million U.S. dollars) and Commissions $3,498.0 million (339.2 million U.S. dollars) million 6.97% 83.8 million 10 semiannual Principal Until French francs French francs payments of 41.8 million $515.7 million French francs (418.1 million French francs) and Commissions $103.4 million (83.8 million French francs) Fiduciary fees $311.4 million $170.2 million 2 Integral hydroelectric units million U.S. dollars 8.94%, 2.5%, 8.73% million U.S. dollars Variable semiannual Principal Until , ,002, , , , ,208, , ,016.7 with 100 MW capacity each and 8.79% payments $1,778.2 million for P.H. TEMASCAL II (173.4 million U.S. dollars) Units 5 and 6 and Commissions $989.0 million (95.9 million U.S. dollars) Fiduciary fees: $152.6 million $41.4 million Transmission Line million U.S. dollars 12.5% and 6.38% 99.7 million U.S. dollars Variable semiannual Principal Until , , , , , ,258.5 MAZATLAN - DURANGO payments $354.8 million (34.4 million U.S. dollars) and Commissions $766.2 million (74.3 million U.S. dollars) Fiduciary fees $36.3 million $21.7 million Transmission Line 66.3 million U.S. dollars 7.15%, 8.9% and 8.09% 27.0 million U.S. dollars Variable semiannual Principal Until , , , , , , , ,148.7 TUXPAN - TEXCOCO payments $315.5 million (30.6 million U.S. dollars) and Commissions $186.7 million (18.1 million U.S. dollars) 720 Self-Transporting Cranes 50.2 million U.S. dollars Variable 2.3 million dollars Principal Until , , , , , , , ,559.9 each half year $247.5 million starting 1999 (24.0 million U.S. dollars) 3.7 million dollars each half year starting 2001 and Commissions $5.2 million (0.5 million U.S. dollars) Payments yet to be applied to specific projects (52,815) (171,241) TOTAL FINANCIAL LEASES $ 6,396,184.0 $ 8,619,002.0 $ 3,046,936.7 $ 14,606,

21 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term PIDIREGAS 3 Combined cycle modules million U.S. dollars million U.S. dollars million U.S. dollars Principal Until $ 7,231,329.8 $ 540,262.3 $ 4,707, , ,479.6 $ 501,488.3 $ 4,917, , ,874.2 with a nominal generation capacity of interest $1,983.1 million MW each (192.3 million U.S. dollars) for C.C.C. Samalayuca II. M - 1, 2 and 3. $2,241.9 million (217.4 million U.S. dollars) 4 Integral geothermo-electrical million U.S. dollars 71.3 million U.S. dollars million U.S. dollars Principal Until 1,065, , , , , , , , ,874.7 units with a 100 MW total capacity interest $208.3 million 2015 for C.G. Cerro Prieto IV (20.2 million U.S. dollars) $245.4 million (23.8 million U.S. dollars) Taxes 4.9 million U.S. dollars $0.9 million in taxes (0.09 million U.S. dollars) 2 Combined cycle modules million U.S. dollars million U.S. dollars million U.S. dollars Principal Until 3,414, ,414, , ,199, ,958.9 with total capacity of MW interest (A single final payment) 2015 for C.C.C. Monterrey II $648.7 million (62.9 million U.S. dollars) Taxes and fiduciary fees 17.6 million U.S. dollars $35.1 million in taxes and (3.4 million U.S. dollars) fiduciary fees 1 Combined cycle module million U.S. dollars million U.S. dollars million U.S. dollars Principal Until 2,860, , ,302, , , , ,366, , ,840.4 with total capacity of 445 MW, interest $335.2 million 2016 for C.C.C. Chihuahua (32.5 million U.S. dollars) $327.9 million (31.8 million U.S. dollars) Taxes and fiduciary fees 6.4 million U.S. dollars $16.5 million in taxes and (1.6 million U.S. dollars) fiduciary fees

22 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term 1 combined cycle module million U.S. dollars million U.S. dollars million U.S. dollars Principal Until 3,174, , ,920, , , , ,837, , ,380.0 with a capacity of MW interest $146.4 million 2016 for C.C.C. Rosarito III (14.2 million U.S. dollars) $456.8 million (44.3 million U.S. dollars) Taxes 37.1 million U.S. dollars $50.5 million in taxes (4.9 million U.S. dollars) 2 Integral geothermo-electrical units 18.2 million U.S. dollars 8.7 million U.S. dollars 18.2 million U.S. dollars Principal Until 187, $ 187, , , ,234.9 with a total capacity of 10 MW interest (A single final payment) 2011 for C.G. Tres Virgenes $10.3 million (1.0 million U.S. dollars) Taxes and fiduciary fees 0.6 million U.S. dollars $0.5 million in taxes and (0.047 million U.S. dollars) fiduciary fees 1 unit thermo electric 39.4 MW 61.3 million U.S. dollars 29.1 million U.S. dollars of 61.3 million U.S. dollars Principal Until 631, , , , , , , , ,409.5 at C.D. Puerto San Carlos II interest $22.7 million 2011 (2.2 million U.S. dollars) $28.9 million (2.8 million U.S. dollars) Fiduciary fees 0.6 million U.S. dollars $0.6 million in taxes (0.06 million U.S. dollars) 2 Geothermal wells 7.6 million U.S. dollars 2.7 million U.S. dollars of 7.6 million U.S. dollars Principal 78, , , , interest LT 211 SUBMARINE CABLE million U.S. dollars 50.3 million U.S. dollars of million U.S. dollars Principal Until 1,031, , , , , , , , ,981.7 interest $241.3 million 2013 (23.4 million U.S. dollars) 3.1 million U.S. dollars in taxes and fiduciary fees $282.6 million (27.4 million U.S. dollars) Taxes and fiduciary fees $16.5 million (1.6 million U.S. dollars)

23 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term SE 212 SF6 POWER million U.S. dollars million U.S. dollars of million U.S. dollars Principal Until 1,079, , , , , , , , ,462.4 interest $109.3 million 2013 (10.6 million U.S. dollars) 5.3 million U.S. dollars in taxes and fiduciary fees $270.2 million (26.2 million U.S. dollars) Taxes and fiduciary fees $10.3 million (1.0 million U.S. dollars) SE 213 SF6 DISTRIBUTION 70.5 million U.S. dollars million U.S. dollars of 70.5 million U.S. dollars Principal Until 726, , , , , , , , ,117.6 interest $129.9 million 2013 (12.6 million U.S. dollars) 2.7 million U.S. dollars in taxes and fiduciary fees $185.6 million (18.0 million U.S. dollars) Taxes and fiduciary fees $6.2 million (0.6 million U.S. dollars) LT 214 SOUTHEAST PENINSULAR 35.4 million U.S. dollars 31.2 million U.S. dollars of 35.4 million U.S. dollars Principal Until 365, , , , , , ,196.2 interest $7.2 million 2010 (0.7 million U.S. dollars) 2.0 million U.S. dollars in taxes and fiduciary fees $81.5 million (7.9 million U.S. dollars) Taxes and fiduciary fees $5.2 million (0.5 million U.S. dollars) LT 215 SOUTHEAST PENINSULAR 97.8 million U.S. dollars 92.4 million U.S. dollars of 97.8 million U.S. dollars Principal Until 1,008, , , , , , , , ,867.3 interest $69.1 million 2015 (6.7 million U.S. dollars) 14.2 million U.S. dollars in taxes and fiduciary fees $207.3 million (20.1 million U.S. dollars) Taxes and fiduciary fees $19.6 million (1.9 million U.S. dollars) LT 216 NORTHWEST 44.9 million U.S. dollars 22.0 million U.S. dollars of 44.9 million U.S. dollars Principal Until 462, , , , , , , , ,551.4 interest $115.5 million (11.2 million U.S. dollars) million U.S. dollars in taxes and fiduciary fees $107.3 million (10.4 million U.S. dollars) Taxes and fiduciary fees $1.0 million (0.1 million U.S. dollars)

24 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term LT 217 NORTHWEST 65.3 million U.S. dollars 61.5 million U.S. dollars of 65.3 million U.S. dollars Principal Until 673, , , , ,088.6 interest million U.S. dollars in taxes and fiduciary fees $198.0 million (19.2 million U.S. dollars) Taxes and fiduciary fees $9.3 million (0.9 million U.S. dollars) SE 218 NORTHWEST 50.7 million U.S. dollars 34.3 million U.S. dollars of 50.7 million U.S. dollars Principal Until 522, , , , , , , , ,095.0 interest $82.5 million 2015 (8.0 million U.S. dollars) $121.7 million (11.8 million U.S. dollars) Taxes and fiduciary fees $6.2 million (0.6 million U.S. dollars) SE 219 SOUTHEAST - PENINSULAR 33.8 million U.S. dollars 16.8 million U.S. dollars of 33.8 million U.S. dollars Principal Until 348, , , , , , , , ,999.0 interest $104.2 million 2009 (10.1 million U.S. dollars) 0.6 million U.S. dollars in taxes and fiduciary fees $91.8 million (8.9 million U.S. dollars) Taxes and fiduciary fees $2.1 million (0.2 million U.S. dollars) SE 220 EASTERN - CENTRAL 62.8 million U.S. dollars 41.4 million U.S. dollars of 62.8 million U.S. dollars Principal Until 648, , , , , , , , ,758.5 interest $84.6 million 2009 (8.2 million U.S. dollars) 1.6 million U.S. dollars in taxes and fiduciary fees $153.7 million (14.9 million U.S. dollars) Taxes and fiduciary fees $6.2 million (0.6 million U.S. dollars

25 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term SE 221 WESTERN 72.5 million U.S. dollars 52.2 million U.S. dollars of 72.5 million U.S. dollars Principal Until 747, , , , , , , , ,141.9 interest $26.8 million 2014 (2.6 million U.S. dollars) 1.3 million U.S. dollars in taxes and fiduciary fees $172.2 million (16.7 million U.S. dollars) Taxes and fiduciary fees $1.0 million (0.1 million U.S. dollars) L.T. 301 CENTRAL 44.5 million U.S. dollars 16.9 million U.S. dollars of 44.5 million U.S. dollars Principal Until 459, , , , , , , , ,710.1 interest $23.7 million 2011 (2.3 million U.S. dollars) $20.6 million (2.0 million U.S. dollars) L.T. 302 SOUTHEAST 41.2 million U.S. dollars 18.9 million U.S. dollars of 41.2 million U.S. dollars Principal Until 424, , , , , , , , ,184.4 interest $38.2 million 2011 (3.7 million U.S. dollars) $36.1 million (3.5 million U.S. dollars) L.T 303 IXTAPA - PIE DE LA CUESTA 27.7 million U.S. dollars 11.6 million U.S. dollars of 27.7 million U.S. dollars Principal Until 285, , , , , , , , ,396.7 interest $28.9 million 2011 (2.8 million U.S. dollars) $22.7 million (2.2 million U.S. dollars) L.T. 304 NORTHWEST 28.2 million U.S. dollars 14.1 million U.S. dollars of 28.2 million U.S. dollars Principal Until 291, , , , , , , , ,651.3 interest $28.9 million 2011 (2.8 million U.S. dollars) $33.0 million (3.2 million U.S. dollars) L.T. 305 CENTRAL - EASTERN 36.5 million U.S. dollars 17.7 million U.S. dollars of 36.5 million U.S. dollars Principal Until 376, , , , , , , , ,304.4 interest $37.1 million 2011 (3.6 million U.S. dollars) $38.2 million (3.7 million U.S. dollars)

26 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term L.T 306 SOUTHEAST 45.0 million U.S. dollars 18.9 million U.S. dollars of 45.0 million U.S. dollars Principal Until 463, , , , , , , , ,599.2 interest $46.4 million 2011 (4.5 million U.S. dollars) $38.2 million (3.7 million U.S. dollars) L.T. 307 NORTHWEST 24.3 million U.S. dollars 12.5 million U.S. dollars of 24.3 million U.S. dollars Principal Until 250, , , , , , , , ,018.1 interest $24.8 million 2011 (2.4 million U.S. dollars) $32.0 million (3.1 million U.S. dollars) L.T. 308 NORTHWEST 44.1 million U.S. dollars 21.1 million U.S. dollars of 44.1 million U.S. dollars Principal Until 455, , , , , , , , ,750.8 interest $45.4 million 2011 (4.4 million U.S. dollars) $44.3 million (4.3 million U.S. dollars) SE 401 WESTERN - CENTRAL 48.0 million U.S. dollars 16.0 million U.S. dollars of 48.0 million U.S. dollars Principal Until 495, , , , , interest 2012 $1.0 million (0.1 million U.S. dollars) SE 402 ORIENTAL PENINSULAR 5.4 million U.S. dollars 2.0 million U.S. dollars of 5.4 million U.S. dollars Principal Until 55, , , , interest 2012 L.T. 403 NORTHEAST 72.5 million U.S. dollars 26.8 million U.S. dollars of 72.5 million U.S. dollars Principal Until 747, , , , , interest $37.1 million 2012 (3.6 million U.S. dollars) $20.6 million (2.0 million U.S. dollars) L.T. 404 NORTHWEST - NORTHERN 40.5 million U.S. dollars 15.2 million U.S. dollars of 40.5 million U.S. dollars Principal Until 417, , , , , interest $10.3 million 2011 (1.0 million U.S. dollars) $11.3 million (1.1 million U.S. dollars)

27 Amount of Agreed Balances at December 31, 2002 (Thousands) Balances at December 31, 2001 (Thousands) Payments Equal to Yields Contract Total Mexican Pesos Foreign Currency Mexican Pesos Foreign Currency, Taxes, Other Asset Type Installation Value Expenses and Fiduciary Fees Principal Payments at Dec 2002 Term Project Amount Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Long-Term L.T. 406 NETWORK ASSOCIATED WITH 72.6 million U.S. dollars 30.0 million U.S. dollars of 72.6 million U.S. dollars Principal Until 748, , , , , , , , ,709.4 TUXPAN II, III and IV interest $49.5 million 2012 (4.8 million U.S. dollars) $45.4 million (4.4 million U.S. dollars) L.T. 407 NETWORK ASSOCIATED WITH million U.S. dollars million U.S. dollars of million U.S. dollars Principal Until 2,606, , ,252, , , , , , ,932.8 ALTAMIRA II, III and IV interest $85.6 million 2012 (8.3 million U.S. dollars) $103.1 million (10.0 million U.S. dollars) L.T. 408 NACOZARI - NOGALES AREAS NORTHWEST 36.1 million U.S. dollars 13.1 million U.S. dollars of 36.1 million U.S. dollars Principal Until 372, , , , , interest 2012 L.T. 410 NATIONAL SYSTEM million U.S. dollars 63.3 million U.S. dollars of million U.S. dollars Principal Until 1,785, , ,669, , , interest 2012 L.T. 411 NATIONAL SYSTEM 66.7 million U.S. dollars 22.8 million U.S. dollars of 66.7 million U.S. dollars Principal Until 688, , , , , interest 2012 $3.1 million (0.3 million U.S. dollars) Items to be applied to specific projects $ (32,598.1) (3,161.0) Subtotal for PIDIREGAS $ 37,182,619.3 $ 2,464, _/ $ 30,565,601.0 $ 1,601,198.2 $ 24,291,909.5 TOTAL LIABILITIES FROM FINANCIAL LEASES AND PIDIREGAS $ 37,182,619.3 $ 8,860,236.0 $ 39,184,603.0 $ 4,648,136.0 $ 38,898,390.6 = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = 1_/ SHORT TERM CAPITAL PAYMENT OF PIDIREGAS, IS AUTHORIZED IN THE 2003 FEDERAL EXPENSES BUDGET