Mexican rebel groups takes credit for attacks that cut oil and gas supplies, rattle markets

VERACRUZ, Mexico – A shadowy leftist guerrilla group took credit for a string of explosions that ripped apart at least six Mexican oil and gas pipelines Monday, rattling financial markets and causing hundreds of millions of dollars in lost production.

The six explosions could be seen miles away, and set off fires that sent flames and black smoke shooting high above the Gulf coast state of Veracruz.

At least a dozen pipelines, most carrying natural gas, were affected, said Jesus Reyes Heroles, the head of Mexico's oil monopoly Petroleos Mexicanos, without providing specifics.

He said there would be hundreds of millions of dollars in lost production and about nine states and the capital, Mexico City, would be affected.

“It is a big blow,” he said. “You can't store natural gas or transport it by truck.”

The blasts caused brief jitters in international markets, with natural gas futures up as much as 20.2 cents on news of the explosions, although prices dropped in later trading. One oil pipeline was hit in Monday's attack but Pemex said the damage wouldn't affect crude exports.

Some local factories were forced to shut after natural gas supplies were cut. Residential supplies were not expected to be affected.

There were no immediate reports of injuries directly caused by the explosions and fires, although Fernando Leon Yepez, a civil defense official in Omealca, reported that two elderly women died of heart attacks shortly after the explosions.

It was the second time in three months that the so-called People's Revolutionary Army claimed responsibility for a pipeline attack as part of what it has labeled its “prolonged people's war” against “the anti-people government.”

The group, known as the EPR, is a secretive, tiny rebel group that staged several armed attacks on government and police installations in southern Mexico in the 1990s. It was later weakened by internal divisions, leaving it unclear which splinter group may have carried out Monday's attacks.

The EPR claimed responsibility for a July attack on a major gas pipeline from Mexico City to Guadalajara in western Mexico that forced at least a dozen major companies, including Honda Motor Co., Kellogg Co. and The Hershey Co., to suspend or scale back operations.

That attack sent the Mexican government scrambling to increase security at “strategic installations” across Mexico.

It was not clear what security measures were in place at the pipelines that exploded Monday.

The government did not immediately confirm the EPR's claim of responsibility. Interior Secretary Francisco Ramirez said the federal Attorney General's Office was trying to determine who was responsible.

“Pemex's fundamental installations are adequately protected by our armed forces, and we will do our utmost to find those responsible,” Ramirez said.

At least 21,000 people were evacuated as a precaution. Some of them were later allowed to return home.

Flames could be seen up to six miles away, said Pedro Jimenez, a resident who was packing his family into a truck to leave. “You could see the fields of crops lit up.”

At least one undetonated explosive device was later found in a swampy area about 500 yards away from a highway toll booth just north of the port of Veracruz, said a Veracruz state police official who was not authorized to be quoted by name.

The official said the device was accompanied by a note signed by the EPR, but it was impossible to independently confirm.

President Felipe Calderón condemned the attacks in a statement from India, where he was on a state visit.

“I want to say that my government severely condemns this and all other acts of violence and those who promote it in our country and anywhere in the world,” he said. “There is no room for such criminal acts in a democratic Mexico.”

Mexico is a major oil producer and exporter, with oil and related taxes accounting for over a third of the federal government's revenue. The U.S. imported 12.7 million cubic feet of natural gas from Mexico in 2006, only about 0.3 percent of total imports that year.

By Miguel Hernandez
ASSOCIATED PRESS