MEXICO CITY (Reuters) -Pemex, Mexico's heavily indebted state energy company, reported an 11.3% drop in first-quarter production of crude and condensate on Wednesday as falling sales and foreign-exchange losses contributed to a 43.3 billion peso ($2.12 billion) net loss.

In a filing with Mexico's stock exchange, Pemex, one of Mexico's largest companies, attributed the production slump to the decline of mature wells and delays in new well completions.

During the first quarter, Pemex and its partners pumped 1.62 million barrels per day (bpd) of crude oil and condensate. The company processed 936,000 bpd in its local refineries, down 5% compared to the year-ago period.

Mexican President Claudia Sheinbaum has pledged to raise production to 1.8 million bpd, although older fields, particularly in the Gulf of Mexico, are being depleted and more recent discoveries have failed to compensate.

On a call with analysts, Pemex's corporate planning chief, Jorge Alberto Aguilar, said the company was working to reach the 1.8-million-bpd goal by the end of the year and maintain it at that level.

Sheinbaum, who will govern until 2030, has said domestic crude production will ensure Mexico can produce the gasoline it needs and end its dependence on motor-fuel imports.

Production has been falling for several months. Pemex has not been within the government's production target since March 2024, when it pumped 1.81 million bpd.

A series of contracts for joint ventures with private companies is being prepared to increase pumping, they added, noting that Pemex will have at least a 40% stake.

Revenue during the January-to-March period fell 2.5% to 395.59 billion pesos, mainly due to lower crude oil sales volumes, Pemex said.

Pemex said foreign-exchange losses and rising costs played roles in its swing to a net loss.

In the quarter, its refining unit yielded 305,000 bpd of gasoline and 171,000 bpd of diesel.

PEMEX AIMS TO REDUCE DEBT BALANCE

Pemex said its financial debt for the three-month period totaled $101.1 billion, up from the $97.6 billion reported in the fourth quarter of 2024.

Already the world's most indebted energy company, Pemex has received billions of pesos in government support. The company said it received 80 billion pesos in government support in the first quarter.

The funds were mainly used to pay down debt. Pemex said its goal "is to reduce the financial debt balance over the course of the year, resulting in a lower balance at the end of 2025 versus the end of 2024."

The company said that 136 billion pesos in transfers from the government were approved for amortizations.

Pemex also reported a decline in drilling activity, completing during the first quarter 12 development wells and five exploratory wells, down from 16 and eight wells, respectively, in the same period in 2024.

Executives of the state-owned giant did not mention on Wednesday whether the drop in well drilling levels had any relation to the debts to suppliers, which reached $19.9 billion at the quarter's close.

In late 2023, local industry groups said Pemex's ballooning debt to its oil service providers and private oil and gas producers was threatening hydrocarbon production and the survival of companies.

Executives said that Pemex will continue to make payments to suppliers and that it is working with the Finance Ministry to seek ways to manage financial and commercial liabilities.

($1 = 20.4604 pesos at end-March)