Mexico's Requirements for Recognizing Force Majeure or Acts of God in Hydrocarbon Contracts

Mexico's Ministry of Energy (Secretaría de Energía or SENER) on Dec. 11, 2025, published in the Federal Register (Diario Oficial de la Federación or DOF) the "Order whereby the Ministry of Energy determines the requirements and the procedure for the recognition or non-recognition of Force Majeure or Acts of God in Hydrocarbon Exploration and Extraction Agreements."

The purpose of the order is to establish a binding administrative procedure for the processing of notifications of force majeure or acts of God (FM/AG), as well as to establish the requirements that contractors must meet for such notifications to be admitted, analyzed and, if applicable, recognized by SENER.

Background

As a result of the constitutional reform on organic simplification published in the DOF on Dec. 20, 2024, as well as the entry into force of the Hydrocarbons Sector Law in March 2025, SENER assumed the powers that previously corresponded to the National Hydrocarbons Commission regarding the administration and technical supervision of hydrocarbon exploration and extraction agreements.

Although the agreements already include specific clauses governing FM/AG, covering their definition, effects and applicable time frames, until now, there had been no detailed administrative procedure regulating the receipt, assessment and resolution of FM/AG notifications submitted by contractors.

The order seeks to address this gap by coordinating contractual provisions with SENER's new administrative powers and by assigning specific functions to different administrative Mexican bodies in order to provide legal certainty and procedural consistency. However, the requirements outlined in the order may go beyond those established in the agreements, which could result in an increased administrative and regulatory burden for contractors.

Key Considerations

Scope of the Order

The order applies to all hydrocarbon exploration and extraction agreements currently in force and exclusively regulates the processing of FM/AG notifications to be submitted during their term.

Burden of Proof

Pursuant to the order, the burden of proof rests with the contractor, who shall comprehensively evidence each of the requirements to establish the existence of an FM/AG in accordance with the applicable contract and the order.

Requirements

The notification shall, among others:

• be submitted within the applicable contractual time frame (or, failing an express contractual term, within 15 calendar days following the date on which the contractor became aware, or should have become aware, of the event)
• provide a detailed description of the alleged act or event, including its date, manner and place of occurrence
• where applicable, precisely identify the contractual obligations that were breached
• evidence the causal link between the event and the contractual breach
• collect and document the actions undertaken to avoid the breach
• demonstrate that the event does not fall within the contractual exclusions to FM/AG
• prove that the event was unforeseeable, unavoidable, beyond the contractor's control and not attributable to willful misconduct

In the case of continuing events, the contractor shall provide evidence on a monthly basis on the diligent actions undertaken throughout the entire duration of the event.

Standing

Where a contractor is the holder or operator of more than one agreement, it shall submit a separate notification for each agreement.

Procedure

The order establishes a procedure that may be summarized as follows:

• submission of the FM/AG notification before SENER, together with the supporting evidence
• initial review and, if applicable, issuance of a request for further clarification or information, including the possibility of dismissal of the request
• admission for processing
• taking of evidence and requests for reports or technical opinions from the competent administrative Mexican bodies
• briefing or pleadings stage, in accordance with the Federal Administrative Procedure Law
• resolution, which shall be issued within 30 calendar days from the date on which the authority determines that the file is complete
• monitoring, where the FM/GA is recognized, and additional obligations are imposed on the contractor

The order also expressly provides grounds for dismissal, including cases where the alleged acts or events arise from breaches attributable to the contractor itself or are remediable through other regulatory mechanisms.

Final Comments

The order establishes a higher standard for recognizing FM/AG, formalizing a process that requires more technical, legal and further evidence from the beginning of the notification process.

Although FM/GA recognition is still considered a mechanism within the corresponding agreement, the new procedure limits administrative discretion. This increases the risk of early dismissal due to documentary issues. In practice, the procedure set forth by the order raises the standards for prior administrative review. As a result, a notification that is incomplete could not only be dismissed but may also negatively impact the contractor's position in later stages of disputes or conflict resolution.

Additionally, the order states that if there are contractual breaches not covered by a recognized FM/AG, SENER has the power and authority to initiate administrative sanction proceedings or take contractual actions. This underscores the importance of carefully evaluating the scope of each notification.

Finally, the order allows early termination of the agreement if petroleum activities are interrupted for a continuous period of two years or more due to a recognized FM/GA. This introduces another relevant issue to consider in the management of prolonged disruptions.

For more information, please contact the authors.

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