Leading The Biggest Company In Latin America

The biggest company in Mexico and Latin America is PEMEX (Petroleos Mexicanos).  It is actually a monopoly which began in 1938 when the Mexican government banned all foreign drillers and formed a national oil company.  Only a handful of oil companies can do what PEMEX does.  It is performs in all the productive chain in the industry. It does the exploration, distribution and commercialization of all the products.  In 2010 average production of crude petroleum was around 2.576 million barrels a day.

Heading this huge company is Dr. Juan Jose Suarez Coppel who is the CEO and Director General. He has held this position since September 2009.  With its huge size and available area for exploration and drilling you may think he has an easy job.  In fact his job is actually difficult as PEMEX cannot be run like an ordinary private oil firm since it is government owned.  

For one PEMEX sends most of its profits to the government. It currently accounts for one third of the government’s income which is a huge amount. This is something that the government cannot forego. There are also many government interests who want their own say in running the company.  Wages are also pegged to government scale which is lower than the oil industry’s. This means it can’t hire the best or retain the best workers.

Thus the company has large potentials which it can’t fully exploit.  Suarez is very much aware of this but understands the changes won’t happen overnight and it will take a lot hard work.   Prior to heading PEMEX he held a number of high positions in other companies such as CFO and Vice President of Administration and Finance at Grupo Modelo, S.A.B. de V.C.

Following His Own Strategy

James J. Mulva first served in the U.S. Navy then worked for only one company until retirement.  His stint in the U.S. Navy in Bahrain exposed him to the oil industry. This led James to getting a job at Phillips Petroleum Company in 1973.

Only a chosen few who enter a company wind up leading it; James is one of the few. His business and financial skills made him stand out and led to numerous promotions. Along the way he learned as much as he could about the business and also observed how other companies in the oil industry were being run and managed.

By 1980 he was vice president and treasurer of the Europe/Africa division of Phillips until 1984. In 1990 he became the chief financial officer.  James became senior vice president in 1993 then executive vice president in 1994. He reached the highest position of chairman and CEO in 1999 until 2002.

James used his own strategy which was not to follow the trend in the oil industry. When many companies were investing in the Middle East, he concentrated on other areas like China; participating in the first offshore oil field in that country.  James also focused on Venezuela, the North Sea, North America, Kazakhstan, and Russia.

While he followed organic grow James took the path of mergers and acquisitions as well. James led the company’s acquisition of the Alaskan oil-and-gas production assets of Atlantic Richfield Company in 2000. To further increase size and revenue the company combined with Conoco another oil entity and became ConocoPhillips in 2002. James served as president and CEO of the merged companies and became chairman in 2004. Under his stewardship the third largest energy company in the U.S. was created.

Among James’s other initiatives was joining a U.S. Department Energy pilot project in 2004 to look into the use of hydrogen as transport fuel.  An even much earlier initiative was to get the then Phillips Petroleum into plastics and chemicals manufacturing.

From acquiring companies to make ConocoPhillips into an energy giant James led the splitting of the company into two; one that produces oil and another that refines it.  Like a good leader he adjusted with the current environment. He retired in May 2012 after the creation of the two independent companies.