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Sonda de Campeche Preliminary Results at March 31, 2020

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Page 1: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Sonda de Campeche

Preliminary Results at March 31, 2020

Page 2: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Forward-Looking Statement & Cautionary Note

1

Variations

If no further specification is included, comparisons are made against the same realized period of the last year.

Rounding

Numbers may not total due to rounding.

Financial Information

Excluding budgetary and volumetric information, the financial information included in this report and the annexes hereto is based on unaudited consolidated financial statements prepared in accordance with International Financial Reporting Standards as issued by the International

Accounting Standards Board (“IFRS”), which PEMEX has adopted effective January 1, 2012. Information from prior periods has been retrospectively adjusted in certain accounts to make it comparable with the unaudited consolidated financial information under IFRS. For more information

regarding the transition to IFRS, see Note 23 to the consolidated financial statements included in Petróleos Mexicanos’ 2012 Form 20-F filed with the Securities and Exchange Commission (SEC) and its Annual Report filed with the Comisión Nacional Bancaria y de Valores (CNBV).

EBITDA is a non-IFRS measure. We show a reconciliation of EBITDA to net income in Table 33 of the annexes to PEMEX’s Results Report as of March 31, 2015. Budgetary information is based on standards from Mexican governmental accounting; therefore, it does not include

information from the subsidiary companies or affiliates of Petróleos Mexicanos. It is important to mention, that our current financing agreements do not include financial covenants or events of default that would be triggered as a result of our having negative equity.

Methodology

We might change the methodology of the information disclosed in order to enhance its quality and usefulness, and/or to comply with international standards and best practices.

Foreign Exchange Conversions

Convenience translations into U.S. dollars of amounts in Mexican pesos have been made at the exchange rate at close for the corresponding period, unless otherwise noted. Due to market volatility, the difference between the average exchange rate, the exchange rate at close and the

spot exchange rate, or any other exchange rate used could be material. Such translations should not be construed as a representation that the Mexican peso amounts have been or could be converted into U.S. dollars at the foregoing or any other rate. It is important to note that we

maintain our consolidated financial statements and accounting records in pesos. As of March 31, 2020, the exchange rate of MXN 23.5122 = USD 1.00 is used.

Fiscal Regime

Beginning January 1, 2015, Petróleos Mexicanos’ fiscal regime is governed by the Ley de Ingresos sobre Hidrocarburos (Hydrocarbons Revenue Law). From January 1, 2006 and to December 31, 2014, PEP was subject to a fiscal regime governed by the Federal Duties Law, while the

tax regimes of the other Subsidiary Entities were governed by the Federal Revenue Law.

On April 18, 2016, a decree was published in the Official Gazette of the Federation that allows assignment operators to choose between two schemes to calculate the cap on permitted deductions applicable to the Profit-Sharing Duty: (i) the scheme established within the Hydrocarbons

Revenue Law, based on a percentage of the value of extracted hydrocarbons; or (ii) the scheme proposed by the SHCP, calculated upon established fixed fees, USD 6.1 for shallow water fields and USD 8.3 for onshore fields.

The Special Tax on Production and Services (IEPS) applicable to automotive gasoline and diesel is established in the Production and Services Special Tax Law “Ley del Impuesto Especial sobre Producción y Servicios”. As an intermediary between the Ministry of Finance and Public

Credit (SHCP) and the final consumer, PEMEX retains the amount of the IEPS and transfers it to the Mexican Government. In 2016, the SHCP published a decree trough which it modified the calculation of the IEPS, based on the past five months of international reference price quotes for

gasoline and diesel.

As of January 1 2016, and until December 31, 2017, the SHCP will establish monthly fixed maximum prices of gasoline and diesel based on the following: maximum prices will be referenced to prices in the U.S. Gulf Coast, plus a margin that includes retails, freight, transportation, quality

adjustment and management costs, plus the applicable IEPS to automotive fuel, plus other concepts (IEPS tax on fossil fuel, established quotas on the IEPS Law and value added tax).

PEMEX’s “producer price” is calculated in reference to that of an efficient refinery operating in the Gulf of Mexico. Until December 31, 2017, the Mexican Government is authorized to continue issuing pricing decrees to regulate the maximum prices for the retail sale of gasoline and diesel

fuel, taking into account transportation costs between regions, inflation and the volatility of international fuel prices, among other factors. Beginning in 2018, the prices of gasoline and diesel fuel will be freely determined by market conditions. However the Federal Commission for

Economic Competition, based on the existence of effective competitive conditions, has the authority to declare that prices of gasoline and diesel fuel are to be freely determined by market conditions before 2018.

Hydrocarbon Reserves

In accordance with the Hydrocarbons Law, published in the Official Gazette on August 11, 2014, the National Hydrocarbons Commission (CNH) will establish and will manage the National Hydrocarbons Information Center, comprised by a system to obtain, safeguard, manage, use,

analyze, keep updated and publish information and statistics related; which includes estimations, valuation studies and certifications. On August 13, 2015, the CNH published the Guidelines that rule the valuation and certification of Mexico’s reserves and the related contingency

resources.

As of January 1, 2010, the Securities and Exchange Commission (SEC) changed its rules to permit oil and gas companies, in their filings with the SEC, to disclose not only proved reserves, but also probable reserves and possible reserves. Nevertheless, any description of probable or

possible reserves included herein may not meet the recoverability thresholds established by the SEC in its definitions. Investors are urged to consider closely the disclosure in our Form 20-F and our Annual Report to the CNBV and SEC, available at http://www.pemex.com/.

Forward-looking Statements

• This report contains forward-looking statements. We may also make written or oral forward-looking statements in our periodic reports to the CNBV and the SEC, in our annual reports, in our offering circulars and prospectuses, in press releases and other written materials and in oral

statements made by our officers, directors or employees to third parties. We may include forward-looking statements that address, among other things, our:

• exploration and production activities, including drilling;

• activities relating to import, export, refining, petrochemicals and transportation, storage and distribution of petroleum, natural gas and oil products;

• activities relating to our lines of business, including the generation of electricity;

• projected and targeted capital expenditures and other costs, commitments and revenues;

• liquidity and sources of funding, including our ability to continue operating as a going concern;

• strategic alliances with other companies; and

• the monetization of certain of our assets.

• Actual results could differ materially from those projected in such forward-looking statements as a result of various factors that may be beyond our control. These factors include, but are not limited to:

• changes in international crude oil and natural gas prices;

• effects on us from competition, including on our ability to hire and retain skilled personnel;

• limitations on our access to sources of financing on competitive terms;

• our ability to find, acquire or gain access to additional reserves and to develop the reserves that we obtain successfully;

• uncertainties inherent in making estimates of oil and gas reserves, including recently discovered oil and gas reserves;

• technical difficulties;

• significant developments in the global economy;

• significant economic or political developments in Mexico;

• developments affecting the energy sector; and

• changes in our legal regime or regulatory environment, including tax and environmental regulations.

Accordingly, you should not place undue reliance on these forward-looking statements. In any event, these statements speak only as of their dates, and we undertake no obligation to update or revise any of them, whether as a result of new information, future events or otherwise. These

risks and uncertainties are more fully detailed in our most recent Annual Report filed with the CNBV and available through the Mexican Stock Exchange (http://www.bmv.com.mx/) and our most recent Form 20-F filing filed with the SEC (http://www.sec.gov/). These factors could cause

actual results to differ materially from those contained in any forward-looking statement.

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Complejo Procesador de Gas Ciudad Pemex

Page 4: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

1Q20 Liquid Hydrocarbons Production

3

• Production of liquid

hydrocarbons increased

compared to 1Q19

• In 1Q20, the change in

production trend, which

had not increased in 14

years, continued

• In the coming months

there will be adjustments in

production due to the

current situation

Liquid Hydrocarbons Production (including partners)1

2018-2020

(Mbd)

1,899 1,869 1,8291,738 1,690 1,690 1,712 1,712 1,759

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

Production

Variation-1.6%

-2.1% -5.0% -2.7% 0.0% +1.3%

1 Considers crude oil and condensates production of fields, including partners. During 3Q19, the crude oil and condensates series was adjusted to include the

proportional part of Ek-Balam’s production that is assigned to the State. Thus, the series was adjusted since 1Q19.

0.0% 2.8%

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1Q20 PEMEX’s Production

4

• Considering PEMEX’s

production only, since

1Q20 the trend

increased

1 Considers crude oil and condensates production of fields, including partners. During 3Q19, the crude oil and condensates series was adjusted to include the

proportional part of Ek-Balam’s production that is assigned to the State. Thus, the series was adjusted since 1Q19.

Liquid Hydrocarbons Production (without partners)1

2018-2020

(Mbd)

1,893 1,860 1,8161,723 1,675 1,673 1,694 1,693 1,739

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

Production

Variation-1.8%

-2.3% -5.1% -2.8% 0.1% +1.2% 0.07% 2.7%

Page 6: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

1Q20 Crude Oil Processing

5

597

705640

505559

595657

557 542

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

Crude Oil Processing, 2018-2020

Thousand barrels per day (Mdb)

• Crude oil processing at

the National Refining

System decreased due

to the rehabilitation

works

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1Q20 Gasoline and Diesel Production

6

• Due to the fact that

rehabilitation works continued

during 1Q20, the production

of high yield refined products

decreased

• When maintenance activities

are completed, an increase in

the crude oil process and oil

production will be observed

192

243219

174 192211 218

193173

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

114

144120

90119

141 143117

103

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

Gasoline Production1

Thousand barrels per day (Mbd)

Diesel Production

Thousand barrels per day (Mbd)

1 Includes intermediate products and excludes naphtha production

Page 8: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

1Q20 Purchases for Resale

7

• Purchases for resale

decreased by 10.2%, as

compared to 1Q19

Purchases for Resale

MXN billion

115.9 104.1

1Q19 1Q20

Page 9: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Mexican Mix Export Price

8Source: PEMEX’s Institutional Database

• In 1Q20, the average price

of the Mexican export mix

was $15.6 per barrel

below the 1Q19 average

• This decrease in the price

of crude oil is the most

relevant variable that

affected the company's

export sales in 1Q20

• In 1Q20, the average price

of the Mexican mix was

$40.9 per barrel, 38%

lower than in 1Q19

53.856.8

59.061.9 60.3

56.8 57.8

49.5

55.150.6 50.5

54.5

48.7

45.0

29.0

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2019 2020

Mexican Mix Export Price (MME)

USD/b

Page 10: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

1Q20 Total Crude Oil Exports

9

600

800

1,000

1,200

1,400

1,600

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Mbd

2019

2020

Variation

(mbd)189 -382 --6

During the first quarter of 2020, average crude oil exports stood at 1,166 Mbd, i.e.

66 Mbd less than in the first quarter of 2019

Total Crude Oil Exports

Thousand barrels per day (Mbd)

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10

MXN Depreciation Generated an Atypical High

Foreign Exchange Loss (non-cash variable)

• The Mexican peso depreciated against the US dollar by 24.8% from

MXN 18.8452 in December 2019 to MXN 23.5122 in March 2020. Therefore,

there is a significant effect of this change on non-cash variables such as

exchange rate losses

• The foreign exchange loss in 1Q20 amounted to MXN 469,206 million, this

amount, mainly does not generate cash flow because it is the valuation of

the variation of the debt balances in foreign currency between December 31,

2019 and March 31, 2020. By international accounting standards, this item

forms part of the company's financial statements

• Therefore, the valuation of debt balances is significantly impacted by the

depreciation of the Mexican peso against the U.S. dollar; however, it does

not affect Petróleos Mexicanos' cash flow.

Page 12: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

1Q20 Financial Highlights

111 Final figures

1Q19 4Q191 1Q20

Sales 356.2 318.5 284.1

Cost of sales 256.6 320.3 243.0

Impairment (reversal) 5.1 104.7 -26.3

Gross Income 94.4 -106.5 67.3

Distribution and administrative

expenses37.7 37.4 38.2

Operating income 60.7 -145.0 30.2

Financial cost, income due to

financial derivatives and others-34.1 -20.4 -62.8

Foreign Exchange profit (loss) 30.4 69.6 -469.2

Taxes and duties 92.4 74.6 60.4

Net income (loss) -35.7 -171.5 -562.2

1

2

3

4

5

MXN billion

6

7

8

9

10

Page 13: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

69,246

53,009

4T19 1T20

21.7

18.7

4T19 1T20

EBITDA1

MXN million

Margen EBITDA1

%

• As with the entire O&G industry, the low crude oil prices in March significantly affected

the profitability levels of Petróleos Mexicanos

• However, PEMEX continued to obtain a profitability close to the average of the

international O&G industry

EBITDA & EBITDA Margin

1 To be comparable with the industry, the EBITDA and EBITDA margin calculations only include variables that generate cash flow. 12

Page 14: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

13

1Q20 Tax Contribution Payments

During the first quarter of 2020, PEMEX paid a total of MXN 167,773 million in fiscal

contributions as a result of its substantial activity.1 If we add to this amount the entire amount of

tax withholdings for MXN 9,949 million, the total tax contributions amounts to

MXN 177,722 million

71,788

13,010

26,2121,368

48,762

6,632

Direct taxes Indirect taxes Substantial activitycontributions

Witholdings Total tax contributionpayment

Tax Contribution Payments as of 1T20(MXN million)

177,722167,773

9,949

86,167

81,606

DUC

DEXTH

OthersIEPS

IVA

Import Taxes

Retained

ISR

1 Does not includes VAT paid to third parties

Page 15: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

General Expenses at 1T20

14

5.5

3.3

1Q19 1Q20

32.2 34.9

1Q19 1Q20

Distribution, transportation

and sales expenses

MXN billion

Administrative expenses

MXN billion

Page 16: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Measures to mitigate the effects of

lower oil prices and low fuels demand

15

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16

Measures to mitigate the effects of lower oil prices and low fuels demand

• Since mid-February, Petróleos Mexicanos activated a protocol to protect its finances in

the face of a low oil price scenario

• It should be noted that the immediate effects of the COVID-19 pandemic include the

temporary reduction of economic activities in virtually all countries of the world, with a

direct and immediate effect on the fossil fuels demand

• The above situation caused volatility in the oil markets with a drop in oil prices

• It should be noted that as a result of a prudent and responsible use of its debt, as well

as the refinancing operations in recent months, the company reduced its liquidity risk

exposure that will allow us to better face the temporary effects of this crisis

• Below, we list the main measures we are taking in the face of this temporary crisis of

low oil prices.

Page 18: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

17

Federal Government Support in 2020

Concept MXN million Observations

Profit Sharing Duty rate decreases to 58% from 65%

(@49 USD/b as defined in the budget)39,918

The new rate applied in

February’s tax declaration

Capital injections established in the approved budget

(these are already programed)46,256

As of today, MXN 26,063

million have been received.

The remainder MXN 20,193

million will be received in

May-July

Cash-out of Pension Liability promissory

Notes 4,984 Redeemed

Additional support because of low oil prices:

Fiscal benefit to reduce the payment of Profit-Sharing

Duty (April 21, 2020)

65,000

To date, MXN 16,250 million

have been credited,

subtracting MXN 48,750

million for the rest of the year.

Total Annual 156,158

• PEMEX has the support of the Federal Government to strengthen its financial position during 2020

through various support measures:

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18

Decree to Reduce Duties’ Payment

• On April 21, the Executive published the Decree granting a fiscal incentive for the payment of the Profit-Sharing

Duty (DUC, for its Spanish acronym) during 2020

• The incentive consists of a tax credit equivalent to 28% of the amount of the taxable base for the calculation of

the DUC, that is, on the value of the hydrocarbons extracted less the deductions provided for in the Ley de

Ingresos sobre Hidrocarburos

• The effective rate of the DUC would be approximately 39%

• The Decree establishes that the maximum amount of the benefit will be of MXN 65,000 million and establishes

the possibility to credit the proportion that corresponds from the provisional payment of the DUC of the month of

March, which was paid on April 27

• This situation meant that April's payment was reduced by MXN 16,250 million, and it is expected to capture

monthly benefits from May to December for MXN 5,417 million to reach the maximum benefit established

16,250

5,417 5,417 5,417 5,417 5,417 5,417 5,417 5,417 5,417

March April May June July August September October November December

Fiscal Benefit due to reduced DUC payment in 2020

(MXN million)

Total: 65,000

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19

Measures to mitigate the effects of lower oil prices and low fuels demand

• The geopolitical situation that has impacted the prices of the Mexican crude oil mix, as well

as the lower export volumes and the drop in domestic demand for fuels caused by the

COVID-19 pandemic, have resulted in PEMEX's revenues being lower than programmed

• In order to face this situation and the impact on budgetary commitments, PEMEX has

implemented a reduction in its investment budget by MXN 45,500 million

• The budget to be exercised during the year will be channeled to projects to maximize

profitability

TOTAL 45,500

Pemex Exploración y Producción 40,500

Other Segments 5,000

Budgetary Investment Reduction 2020

(MXN million)

Page 21: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

20

Measures to mitigate the effects of lower oil prices and low fuels demand

• Petróleos Mexicanos estimates that it will receive MXN 7,540 million for the oil hedge

contracted for 2020

• Another factor that will have an impact on our cost of sales will be the decrease in

gasoline and diesel imports that we are projecting from May and towards the end of

2020

• This will be possible due to the high inventories we have of products and the increase in

the levels of the crude oil process that are expected to start in August 2020

• Finally, in order to strengthen the payment process to our suppliers and contractors, we

would like to announce that we have reached a preliminary agreement with Nacional

Financiera to strengthen the available line of the Cadenas Productivas Program, which

currently amounts to MXN 12,623 million, which today has 61.5% of that amount

available. We will soon be announcing this agreement

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Instruments available to alleviate the effects of

the drop in crude oil prices

1. Access to available committed credit lines of nearly USD 6 billion

2. Reduction of MXN 45.5 billion to 2020 investment budget

3. Additional tax benefit of MXN 65,000 million

4. Additional income of MXN 7,540 million from the oil hedge contracted by

PEMEX

All these measures and other government support amount to

MXN 156,158 million. The objective is to mitigate the effects of

falling oil prices on the company's balance sheet and liquidity

21

Page 23: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Net Indebtedness 2020MXN billion

22

Approved net

indebtedness 2020

Net indebtedness goal

for 2020

Financing 176.0 141.0

Amortizations 141.0 141.0

Net Indebtedness 35.0 0

Annual net indebtedness and net indebtedness goal

24 45 62

223195

232

72 60

-29

0

-50

0

50

100

150

200

250

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020e

Net indebtedness

• The net indebtedness ceiling

approved by the Congress in

2020 amounts MXN 10,000

million and USD 1,250 million,

respectively.

• PEMEX’s goal is to achieve zero

net indebtedness.

• With january refinancing

operation, PEMEX covered

approximately 70% of the

refinancing program for 2020.

Net Indebtedness: new debt issuance minus amortizations

Page 24: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Pozo Chejekbal 1, Tabasco

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Liquid Hydrocarbons

Production Increased

Daily Liquid Hydrocarbons Production

Mbd

Note: During the 3Q19, the crude oil and condensates series was adjusted to include the proportional part of Ek-Balam’s production that is assigned to the State.24

62% 63% 63% 63% 64%

28% 27% 28% 28% 27%

8% 8% 8% 7% 8%1% 1% 2% 2% 1%1,674 1,673 1,694 1,693 1,739

0

400

800

1,200

1,600

1Q19 2Q19 3Q19 4Q19 1Q20

Liquids Quarterly ProductionMbd

Heavy Light Extra-light Condensates

81%

19%

Crude Oil Production1Q20

Offshore Onshore

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Hok-44

Tlacame-3

Mulach-10

Chejekbal-1

46

0

10

20

30

40

50

60

Mb

d

Producción temprana, pozos exploratorios

Pozos de desarrollo

Xikin-22

Quesqui-1

Valeriana-1

Cibix-1

Chocol-1

Ixachi-1

Ixachi-1DL

Dec Jan Feb MarNov

Quesqui-1

(ducto)

13

21

19

34

25

The increase in production was due to the incorporation of new developments and the early production of new fields, at the end of March

there was an increase of 46 Mbd

Deferred production of the new fields is due to:

• Delay in the construction of the infrastructure

• Bad weather conditions

• Operational problems in well drilling

Page 27: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Natural Gas Production

Remains Stable

1 Does not include nitrogen

2 Includes nitrogen

2

26

75% 75% 74% 75% 75%

25% 25% 26% 25% 25%

3,668 3,637 3,685 3,767 3,738

0

1,000

2,000

3,000

4,000

1Q19 2Q19 3Q19 4Q19 1Q20

Natural Gas Production1

MMcfd

Associated Non-Associated

54%

46%

Natural Gas Production1Q20

Offshore Onshore

243 261 310 396 459

94.9% 94.5% 93.6%91.9% 90.6%

0

200

400

600

1Q19 2Q19 3Q19 4Q19 1Q20

Natural Gas UseMMcfd

Gas Flaring (MMcfd)

Natural Gas Use /Total Gas Produced

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Urea 1 - Cosoleacaque, Ver.

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Crude Oil Process and Refined ProductsProduction

281 Includes dry gas, gasoil, light cyclic oil, aeroflex, asphalts, coke, lubricants and paraffins.

• In the last two quarters, the crude oil

processing has been limited

because the refinery maintenance

program continues to be carried out.

However, in 1Q20, Madero and

Salamanca refineries registered

increases in the crude oil process of

41 Mbd and 29 Mbd, respectively.

• The variable refining margin

decreased as a result of both the fall

in crude oil prices and the reduction

in demand for refined products.

284 331 313 272 268

275264 344

285 274

559 595

657

557 542

-

200

400

600

1Q19 2Q19 3Q19 4Q19 1Q20

Crude Oil ProcessingMbd

Heavy Crude

Light Crude

5.27

-0.99

1.61

-2.64

-12.51-13.0

-10.0

-7.0

-4.0

-1.0

2.0

5.0

1Q19 2Q19 3Q19 4Q19 1Q20

Variable Refining MarginUSD/b

180 196 202 181 173

141 159 163 136 126

119 141 143

118 103

7 8 7

7 6

26 28 33

29 26

88

104 121

110 114

561

636 668

580 547

-

200

400

600

1Q19 2Q19 3Q19 4Q19 1Q20

Production of Petroleum ProductsMbd

Other*

Jet Fuel

LPG

Diesel

Fuel oil

Automotivegasolines

1

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Gas Processing and Production

291 Includes fractioning fluents.

2,360 2,336 2,458 2,427 2,380

420 417 430 455 446

2,780 2,753 2,889 2,881 2,826

-

700

1,400

2,100

2,800

1Q19 2Q19 3Q19 4Q19 1Q20

Wet Gas ProcessingMMcfd

Sweet Wet Gas

Sour Wet Gas

2,314

2,218

2,368

2,314

2,241

224 223 218 220 225

100

200

300

400

2,000

2,200

2,400

1Q19 2Q19 3Q19 4Q19 1Q20

MbdMMcfd

Dry Gas and Gas Liquids Production

Dry Gas fromPlants (MMcfd)

Natural GasLiquids (Mbd) 1

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Petrochemicals Production

30

1 Includes carbon dioxide, petrochemical specialties, crude butadiene, pyrolysis liquids, hexane, heptane, polyethylene waxes, oxygen, butanes, pentane blend,

nitrogen, hydrogen, CPDI, isopentane and pentane.30

42 31 30 38 49

149 143 150

97 91

53 48 56

44 69

39 35

47

39 18

93 92

99

98 91

56 53

73

43 57

46 50

54

43 49

478 453

510

402 423

-

100

200

300

400

500

600

1Q19 2Q19 3Q19 4Q19 1Q20

Production of petrochemicalsThousand tons (Mt)

Other*

Carbon black

Sulfur

Propylene andDerivatives

Aromatics andDerivatives

Ethane Derivatives

Methane Derivatives

1

Page 32: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Industrial Safety Performance

31

In all moderate and severe events, Petróleos Mexicanos

performs a root cause analysis to identify the causes and

defines corrective actions to prevent recurrence

0.13

0.35

0.27

0.19 0.21

0.0

0.1

0.2

0.3

0.4

0.5

0.6

1Q19 2Q19 3Q19 4Q19 1Q20

Frequency indexAccident with disabling injuries/ MMhh

5

15

20

25

7

-

5

10

15

20

25

30

1Q19 2Q19 3Q19 4Q19 1Q20

Severity IndexTotal number of days lost/ MMhh

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Centro de Proceso Akal-C

Page 34: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Centro de Proceso Akal-C

Page 35: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Questions and Answers

Alberto VelázquezChief Financial Officer

Reinaldo WencesDeputy Director of Evaluation and Regulatory Compliance at Pemex Industrial Transformation

Francisco FlamencoActing General Director at Pemex Exploration and Production

34

Page 36: Preliminary Results at March 31, 2020...Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mbd 2019 2020 Variation (mbd) 189 -382 --6 During the first quarter of 2020, average crude oil

Investor Relations

(+52 55) 9126-2940

[email protected]

www.pemex.com/en/investors Sonda de Campeche