Client Alert: The USMCA (NAFTA 2.0) Protects U.S. Oil and Gas Investments in Mexico

In 2013, Mexico amended its constitution to allow foreign companies to enter into agreements to explore for and extract hydrocarbons in Mexico. Since then, U.S. oil and gas companies have invested billions of dollars in Mexico with uncertain protection under NAFTA. The United States-Mexico-Canada Agreement (USMCA) ushers in protections for current and future investors in Mexico’s upstream hydrocarbon sector. Once Canada ratifies this treaty, U.S. companies’ direct and indirect investments in Mexico’s hydrocarbon sector will be safeguarded by traditional investment treaty protections.