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GASOLINE OUTDOOR, OPPORTUNITY THAT KCSM USED

During the month of January there was a crisis of shortage of gasoline. More than 10 states were affected by the Mexican government’s plan to combat huachicoleo, a strategy that sought to reduce the theft of hydrocarbons. A strategic part of the plan was to close the valves of the pipelines that transport gas, crude oil and gasoline, which generated problems with the supply of fuel. In Mexico City, 85 of the 400 gas stations registered a problem. Mexico has 17,000 kilometers of pipelines belonging to Petróleos Mexicanos (PEMEX) and it is in these networks that the theft of hydrocarbons mainly occurs. In 2018, these robberies cost the Mexican state 60 billion pesos.
Thanks to the energy reform of 2013, the Mexican oil sector was opened to private investment, allowing various companies to sublease Mexican pipelines, which generates considerable savings in transportation costs, that is, it was possible to generate competitive conditions. But with the closure of these, they had to find another alternative to transport gasoline. PEMEX, where appropriate, reorganized its supply chain by transferring thousands of liters of gasoline in pipes. This shortage represented the first crisis of the government, however, a company took advantage of this crisis and managed to use it in their favor, increasing their sales.
Kansas City Southern de Mexico (KCSM) is a railway company dedicated to the transport of cargo and was used as one of the safest and least expensive options -including the pipes- to deal with the shortage of gasoline. This company is one of the most attractive options for the market – given the lack of private infrastructure to store gasoline and transport it via pipelines – and is investing to have a storage center in San Luis Potosí that will have a capacity of 300 thousand barrels . In such a way that the savings in the transportation of gasoline can reach up to 25% in relation to the use of pipes, besides that this option represents a safer option compared to the use of pipelines.
KCSM has a strategic alliance with ExxonMobil, a Texan oil company, with which it imported a total of 2.6 million barrels between 2017 and 2018. In February, in response to the crisis, KCSM had an increase of 135% in the volume of imported gasoline through their trains. And, according to the president of KCSM, José Guillermo Zozaya, it is expected that imports will continue to rise as companies -mainly international- do not want to have a shortage problem again; for what he has already added to Total S.A. as a new customer.
One of the advantages that KCSM presents is that its network is international, which places it as a leader in rail transportation of gasoline in Mexico. In addition, it has an adequate infrastructure for the use of advanced technology and is part of the Asset Health Strategic Initiative, which seeks to reduce mechanical service interruptions, improve the quality of wagon inspection and increase the efficiency of railway workshops. They also use 400 drones to monitor the most conflictive routes and monitor all trains through multiple security filters. These security measures have allowed the company to only have 0.02% vandalism.
In this way KCSM was able to take advantage of the crisis of the huachicol and was placed as the safest and most economical option for the transportation of gasoline. All thanks to an advanced security strategy, the use of technologies and the correct implementation of international protocols in the field.

Do you need help to see find opportunities in the midst of crisis? Write to info@riesgospoliticos.com.mx to provide you with the advice that your company requires.

 

Photo by Samuel Fyfe on Unsplash

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