Canadian Court Reopens $270 Million NAFTA Dispute Against Pemex

A Canadian court overturned an arbitration ruling favoring Mexico, reopening a $270 million legal battle over Pemex’s alleged contract breaches and corruption.

By: AXL Media

Published: Apr 21, 2026, 9:26 AM EDT

Source: Mexico News Daily

Reversal of Jurisdictional Protections

The case was initially quashed in August 2024 when an international arbitration tribunal declared it lacked the competency to hear the dispute. That panel had ruled in favor of Mexico based on the claimants’ Mexican nationality and their close ties to the domestic market. However, the Canadian court recently found that the tribunal’s jurisdictional decline was flawed. Notably, the court cited a failure by Chilean arbitrator Andrés Jana to disclose potential conflicts of interest stemming from his separate counsel work.

In addition to reopening the substantive analysis of the case, the court ordered the Mexican government to pay $100,000 in legal costs within a 30-day window. This procedural shift moves the litigation past technicalities and toward a definitive ruling on the merits of Oro Negro’s claims. If Mexico is ultimately found liable for breaching trade obligations, the national treasury could be forced to settle a nearly $300 million penalty.

Strategic Conflict and the Bankruptcy of Oro Negro

The legal battle has its roots in a contractual relationship established between 2013 and 2017, during which Oro Negro leased five sophisticated oil platforms to Pemex. The oil services firm alleges that Pemex leadership began a systematic campaign to undermine these contracts in 2015. According to the plaintiffs, the state utility manipulated agreed-upon tariffs, coerced the company into accepting lower lease rates, and eventually terminated the contracts prematurely in favor of competitors.

These actions directly triggered the bankruptcy of Oro Negro, transforming a commercial disagreement into a landmark Chapter 11 investor-state dispute. The company’s investors argue that Mexico failed to provide the "fair and equitable treatment" guaranteed under NAFTA and that Pemex’s actions amounted to a de facto expropriation of their assets. This case remains one of the most significant energy sector disputes inherited from the pre-USMCA era.