Contributed By Gonzalez Calvillo, S.C.
Under Mexican law, title to natural resources belongs to the state. To that end, the exploitation of natural resources typically requires an authorisation from the relevant government agency in the form of a concession or permit. Generally, the latter is usually only granted to Mexican entities. Likewise, and depending on the specific resources, there are restrictions for private players to participate in activities across the spectrum (extraction, transportation, distribution, export, etc). In other words, certain activities related to the exploitation of natural resources are reserved exclusively for the state.
The payment of certain fees may also be required depending on the specific activity or natural resource being exploited. For example, private entities engaged in upstream activities are required to pay/receive a percentage (either in cash or in kind, depending on the specific contract) on the gross value/amount of the hydrocarbons produced.