Mexico's new development and modernization strategy for the natural gas industry and market is based on two pillars: public and private investment. PEMEX, a public organism, is responsible for upstream development, whereas the private sector is in charge of downstream development. In view of macroeconomic constraints, PEMEX is currently facing difficulties in financing its activities. The government is thus discussing whether to authorize a partial opening in exploration and production activities through a special type of service contract. As for the private sector's participation in transport, storage and distribution, there are still institutional, regulatory, entreprenurial and legal questions pending that may delay or inhibit investments. PEMEX's performance is crucial for private capitals to set up and survive in the spaces that have been opened to them. Mexico's full integration to the North American natural gas market is advancing slowly since there is still a need for substantial changes in assets ownership. In any case, il is very likely Mexico will participate as a net exporter in the medium-and long-terms.

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