ENERGY RESOURCES Petroleum The Mexican petroleum industry was nationalized in 1938 after a bitter and protracted struggle between foreign companies and the government. A state agency, Petroleos Mex-icanos (Pemex), is by law the only company operating in the petroleum and natural gas field. Its operations include exploration, production, refining, distribution, and the man-ufacture and sale of all basic petrochemicals and certain other derivatives. With the assistance of World Bank loans, Pemex is in the midst of a program to expand its drilling, refining, and distribution facilities so that it can keep pace with the growing domestic demand for petroleum products. Pemex refining facilities have a production capability of more than 500,000 barrels per day, but the internal demand for petroleum is slightly greater than Pemex's current capacity. Consequently, in both 1969 and 1970, the company imported more petroleum products than it exported. Nevertheless, production grew by more than 5 percent in 1970. At present, reserves are being expanded through off-shore drilling in the Gulf of Mexico, and a recent discovery on the Continental Shelf is said to be the largest and richest field discovered in 40 years. Drilling In 1970, Pemex drilled 523 wells 130 were exploratory, of which 8 did not reach their objective because of mechanical failure, and 393 were development wells. The total footage drilled in 1970 was 4,545,500 feet, of which 1,300,878 feet were exploratory drilling. The average depth of the exploratory wells was 10,068 feet, and that of the development wells was 7,238 feet. The successful discovery of new-field wildcat wells decreased from 23 percent in 1969 to 18.8 percent in 1970. The success rate in drilling of exploratory wells declined from 45.5 percent in 1969 to 28.3 percent in 1970. Exploratory Crews During 1970, 27 surface geologic parties, 15 subsurface geologic parties, 23 seismic parties, 3 gravimetric parties, and 1 land magnetometer crew were active. 43