The theft of $3 billion in fuel every year from Mexico’s state-run fuel depots and pipelines is an inside job, the country’s new president said Thursday.

Mexico’s new president: Fuel theft an inside job

December 27, 2018

MEXICO CITY (AP) — The theft of $3 billion in fuel every year from Mexico’s state-run fuel depots and pipelines is an inside job, the country’s new president said Thursday.

President Andres Manuel Lopez Obrador said thieves don’t just drill taps into government pipelines. He said company employees steal fuel and distribute it, or help thieves by ensuring fuel continues to run through pipelines.

Mexico’s top prosecutor said criminal investigations have been opened against three employees of the state-owned oil company Pemex for alleged involvement in thefts.

While thieves drill an average of about 42 illegal taps a day, Lopez Obrador said that represents only about 20 percent of losses. The rest was presumably stolen from distribution centers aboard tanker trucks.

“There is a hypothesis that of all the (fuel) thefts, only about 20 percent is done by illegal pipeline taps,” Lopez Obrador said. “It’s a kind of smoke-screen, and the majority is done through a scheme that involves the complicity of authorities and a distribution network.”

Lopez Obrador suggested much of the stolen fuel leaves distribution centers aboard about 600 tanker trucks carrying fuel worth about $10 million every day.

Authorities have long suspected Pemex employees of complicity in the thefts, since drilling illegal taps and extracting fuel without causing an explosion requires expertise.

But an even bigger mystery has been how that much stolen fuel gets sold. Simply selling it on roadsides to passing truckers could never account for the vast amount of stolen gasoline and diesel.

A few dozen gasoline stations have been implicated in selling stolen fuel, but that also wouldn’t account for enough sales volume.

“If we’re talking about 600 tanker trucks per day, we’re not just talking about ‘huachicol’ pipeline thefts,” Lopez Obrador said. “We are talking about a scheme that has involvement inside the governments and has a fuel distribution system, because it is not easy to distribute and sell 600 tanker trucks per day.”

One outlet for all the stolen fuel appears to be construction sites, to power dump trucks and heavy machinery.

“A lot of companies, when they are working on a construction project, bought stolen fuel, and I am calling on them not to do it,” Lopez Obrador said. “On big projects, there were fuel deposits where they sold cheap diesel and gasoline.”

Officials say that by targeting corrupt employees and monitoring fuel shipments they have already managed to reduce the thefts since Lopez Obrador took office on Dec. 1.

Military personnel are participating in a new plan to monitor distribution depots.

Still, the problem remains strikingly widespread; authorities found 12,581 illegal pipeline taps in first 10 months of year, equivalent to about 42 per day. Fuel theft gangs also have brought extreme violence to previously peaceful states in central Mexico, and the gangs frequently recruit entire neighborhoods to block police raids and acts as lookouts.