By Anthony Esposito and David Alire Garcia
MEXICO CITY, Jan 30 (Reuters) - Mexican President AndresManuel Lopez Obrador brushed off a credit downgrade to state oilcompany Pemex, arguing on Wednesday that corruption isbeing eliminated from its ranks and the firm is stronger than ithas been in 30 years.
Rating agency Fitch on Tuesday downgraded PetroleosMexicanos, the official name of the state oil and gas producer,which holds some $106 billion in financial debt. [nL1N1ZU03M}
At a regular news conference, Lopez Obrador lashed out atthe ratings agency, saying Fitch was hypocritical because in thepast it gave the firm positive reviews despite its problems.
"They kept quiet and were complicit, and now that Pemex isrecovering they come out with their recommendations and try tograde Pemex's performance," said the veteran leftist, who vowedto revive Pemex during his 2018 election campaign.
The Fitch downgrade sent the peso currency tumblingon Wednesday morning before it pared losses.
Rival ratings agency Moody's will maintain Pemex's creditrating in the first half of the year, its Senior Vice PresidentNymia Almeida said on Wednesday, while monitoring how thecompany performs under Lopez Obrador.
"This government is coming with a very strong mandate toreduce expenses ... and this is just what the company needs,"she said at an energy conference in Mexico City, according tolocal media reports. "We won't take any action until seeing thefirst half-year."
Pemex's total debt load is the highest of any national oilcompany in Latin America, and a former executive said thedowngrade would put pressure on the firm for now.
"Pemex will face higher financial costs and its projectswill get a little more expensive," Carlos Morales, who served asPemex's exploration and production chief for a decade through2014, told an oil conference in Mexico City.
Lopez Obrador has promised to reverse Pemex's dwindlingoutput, and is pushing to stamp out rampant gasoline theft fromthe firm's pipeline network that has caused significant losses.
His plan to raise output, currently at about 1.8 millionbarrels per day (bpd), is mostly built on plans to pump moregovernment money into exploration and production.
Lopez Obrador also wants to build what would be Mexico'sbiggest oil refinery on the southern Gulf coast.
He has not detailed how his government will finance theproject that he has said will cost around $8 billion, and hasbeen a staunch critic of a landmark 2013-14 energy reform thatopened up the Mexican oil industry to private investment.
The reform ended Pemex's decades-long monopoly by allowingprivate producers to operate projects on their own, as well asenter into partnerships with Pemex known as farmouts.
Alberto de la Fuente, Mexico country manager for Royal DutchShell Plc, told the conference after the Fitchdowngrade that Lopez Obrador should reconsider the role ofprivate companies.
"If (Mexico) were carrying out more oil auction rounds, more(Pemex) farmouts, that could give positive signals to financialsector investors," he said. "Pemex doesn't have the means to doeverything it wants to do and (private) capital could help."(Reporting by Anthony Esposito, David Alire Garcia and LizbethDiazEditing by Daniel Flynn, Marguerita Choy and Lisa Shumaker)
