The major activities carried out by the Association on energy matters were mainly focused on generating the competitive conditions urgently required by the chemical industry.

On legislative matters the strategy of approaching key legislators, members of the Energy, Treasury and Economy commissions of the Chamber of Deputies, and of the Energy, Treasury, Trade and Industrial Promotion Commissions of the Senate was followed. During these meetings ANIQ was able to position the industry and particularly to submit several alternatives to promote the energy sector in view of the Energy Reform bill presented by President Calderón.

As a result of the presence and the positions taken by the Association during the months before the Energy Reform was passed, ANIQ managed to open a space for Mr. José Luis Zepeda, ANIQ's President, to participate in the Consultation Forums organized by the Mexican Senate.

During his appearance in the Senate, Mr. Zepeda highlighted the current situation of the energy sector and suggested very specific actions to promote investment and competitiveness in the natural gas, basic petrochemistry and refining sectors.

Additionally, several meetings were held with the three major political parties. The comments made by the Association to the energy bill were presented to every political party.

On the other hand, major actions submitted by ANIQ to the Mexican President were focused on solving the problems in the following areas:

Electricity

To solve the problems faced by the electricity sector, ANIQ worked together with CONCAMIN's Energy Commission to emphasize the loss of competitiveness of the industry resulting, among other factors, from the increases in electricity rates in view of the enormous variations in the price of fuels.

To support the aforementioned, a competitiveness survey of the power industry was carried out. The survey suggested several measures to correct the lack of competitiveness of electricity rates in Mexico. As of March 1, 2008, the implementation of these measures achieved a decrease of the power rate at peak hours.

Furthermore, and aiming at reducing the impact of the price of fuel oil on the inflation adjustments of electricity rates, an 8 to 10% reduction in fuel oil price was achieved to be applied by the Ministry of Finance and Public Credit on the fuel oil sold by PEMEX to the Federal Electricity Commission.

Natural Gas

Natural gas reached its highest historic price in the country ever, reaching a peak of US$12.50 per MMBTU that is, a 93% increase from January to June 2008.

As a response to the negotiations undertaken under the leadership of CONCAMIN, PEMEX Gas y Petroquímica Básica (PGPB) and the Energy Regulatory Commission agreed upon a “step-up coverage” plan to mitigate price volatility.

The industry challenged the resolution issued by the Energy Regulating Commission with respect to Chapter II of the Price and Considerations Catalog that is included in the General Terms and Conditions for the First Hand Sale of Natural Gas.

Consequently, in view of the above, a test period of “Parallel Invoicing” was agreed for a specific number of companies that are intensive users of natural gas. To measure the impact of this new course of action a simulator offered by PGPB will be used.