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Gas Theft - Mexico's Latest Criminal Conundrum

MEXICO / 30 OCT 2019 BY SUKANTI BHAVE EN

With Mexico’s President Andrés Manuel López Obrador touting his successes against oil theft, criminal groups have taken advantage of a similar opportunity: gas theft.

According to figures from the Mexican Association of Liquefied Petroleum Gas Distributors (Amexgas), 13 billion pesos ($670 million) of liquefied petroleum gas (LPG) had been stolen by October 2019, the BBC reported. More than 500 clandestine taps of LPG infrastructure have been discovered in 2019 so far, up from 215 in all of 2018.

Amexgas also reported that LPG theft had become such a problem it was costing national oil company Pemex losses worth 500 million pesos ($26 million) a month, or 11 percent of its total LPG sales.

SEE ALSO: Early Gains Cloud Need for Long-Term Approach for Mexico’s Oil Thieves

The crime, referred to as “gaschicol” in Mexico, is very similar to oil theft, with gangs perforating pipelines and installing clandestine taps or outlets to divert the gas. One difference is that while oil can be stolen when the pipelines are full, stealing gas requires temporarily stopping the pipe’s operations. Next, these groups sell containers of LPG on the black market directly to households, disguising their delivery vehicles to look like regular gas distribution trucks.

But the extraction and distribution of gas in this manner is a risky business. Ruben Salazar, director of the consulting firm Elleket, told the BBC that LPG extraction is much more volatile than gasoline or diesel extraction because “rudimentary techniques are employed.”

According to him, the gangs often transport the LPG in water trucks, which are not suited for that purpose and might explode. Additionally, the stolen gas is often stored near residential areas, creating a fire hazard.

In August, an attempted fuel theft at the Cactus-Zapotlanejo LPG pipeline north of Mexico City led to a gas leak that forced the evacuation of 3,000 people. To stop the leak and disperse the gas cloud, Pemex had to shut down the pipeline and three gas terminals.

InSight Crime Analysis

Cracking down on oil theft has been the focal point of President López Obrador’s anti-crime strategy to date. But while he has succeeded in drastically reducing the quantity of oil being stolen, the total number of illegal taps on pipelines has risen slightly in 2019. The accompanying rise in LPG theft is another symptom of this lucrative criminal economy.

The geography and groups behind gas theft are strikingly similar to oil theft.

For example, gas theft also remains concentrated in Mexico’s heavily populated and industrialized central states, according to Carlos Serrano, president of Amexgas.

“This theft is concentrated in the center, in Mexico City, the State of Mexico, Puebla, Veracruz, Hidalgo, Tlaxcala and Guanajuato," he told La Jornada in an interview.

SEE ALSO: Stopping Oil Theft in Mexico Futile Game of Whac-a-Mole

The Jalisco Cartel New Generation (Cartel Jalisco Nueva Generación – CJNG) and the Santa Rosa de Lima Cartel, whose fight for control of oil pipelines fueled a staggering rise in violence in the state of Guanajuato, are also heavily involved in stealing gas, according to the BBC.

And the scale of LPG operations across Mexico makes government action against gas theft extremely difficult. Since 2016, the transportation and distribution of LPG has been privatized, allowing companies to deliver gas to millions of homes and businesses. This decentralization has been part of Mexico’s Energy Reform but has made it trickier to identify illegal players within the market.

Furthermore, López Obrador may struggle to avoid some of the pitfalls which have marred his oil theft crackdown. In January 2019, shortly after taking office, he temporarily shut down four major pipelines and announced that fuel would be transported by truck and rail. This move led to massive shortages across the country. Even if he wanted to try this again, since the stolen LPG is being moved in vehicles disguised as distribution trucks, this method seems unlikely.

Another factor has been corrupt Pemex workers informing gangs of the ideal time to strike. The government vowed to clean up Mexico’s biggest company and eradicate such activity but according to the BBC, workers are now specifically sharing information leading to gas theft.

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