Many of the ills afflicting Mexico, Pemex, and the national oil sector stemmed from the lack of technology transfer and insufficient innovation. The reform measures directly and indirectly confronted the need to foster innovation, and contained legal and other elements that would direct and incentivize embracing technology and innovation across the industry—especially at Pemex. Indeed, provisions in the newly created contractual environment pushed Pemex maximize innovation and technology transfers. But in more concrete terms, the government has also sought to directly support investment in technology and innovation. Overlooked but also important is the fact that Mexico has inserted itself into the global energy governance system, and has formally joined institutions such as the International Energy Agency (IEA) and the Extractive Industries Transparency Initiative (EITI) that will enhance the institutional overhaul and transparency of Mexico’s oil sector.

On top of all of the major changes to the country’s hydrocarbons sector, the broader intent of the energy reforms, and subsequent Energy Transition Law, underscore the Mexican government’s desire to build an energy sector that is commensurate with the need to shift to a low-carbon growth model in the country. Mexico has made a strong commitment to boosting clean energy deployment and set forth ambitious emissions reduction targets and goals as part of its agreement as a signatory to the Paris Agreement on Climate Change.

The path to fully consolidating the reforms and creating a truly competitive, liberalized Mexican oil market is a long one. It is not very useful to set a timetable or projection for when that will or should occur. Yet it is clear that the first critical tests have been passed and the country’s path forward to a modern oil sector is far clearer today than before the reform was implemented. There will be challenges, and the rapidly changing global energy outlook is particularly critical for Mexico and where its oil sector fits. But this time, it is indeed different.