MEXICO CITY, April 4 (Reuters) - Mexico's presidential

front-runner Claudia Sheinbaum plans to invest in state-owned

Pemex' oil refineries to reduce the huge volumes of low-value

fuels produced and instead boost the output of motor fuels, one

of her advisors said.

Pemex has been producing record levels of heavy fuels, such

as the particularly polluting fuel oil, as its local refineries

struggle to process the heavy Maya crude it pumps.

Last year, Pemex produced 260,285 barrels per day (bpd) of

fuel oil - exceeding the production of gasoline at 252,203 bpd.

Considered a waste product, in Mexico fuel oil is mainly

burnt for electricity generation.

"Refineries are very expensive and important assets to reach

energy self-sufficiency," said Jorge Islas, the energy

coordinator for Sheinbaum, in an interview on Wednesday.

Islas, a physicist and doctor in economics, pointed to the

possibility of building a new coking unit at the Salamanca

refinery to increase gasoline and diesel production. Currently,

the refinery is operating at just over half of its capacity.

Coking units are able to process the heavier hydrocarbons

coming out of distillation towers into higher-value products,

including motor fuels.

Under President Andres Manuel Lopez Obrador, Pemex has

invested billions of dollars to rehabilitate its six obsolete

domestic refineries. Refining has been a loss-making business

for Pemex for years.

In order to wean the country off expensive imports, Pemex

also formally inaugurated the new Dos Bocas refinery in July

2022, despite running late and over budget by several billions

of dollars. While the 340,000-bpd refinery is operational, it

does not yet produce finished fuels.

Pemex already has two new coking plants in Salamanca and

Tula which are expected to come into operation between this year

and next.

Lopez Obrador had promised that Mexico would achieve

"energy sovereignty" during his six-year term. However, a few

months before he leaves office on Oct. 1, the goals seem complex

to achieve even as refineries have improved their performance.

The six local refineries together have the capacity to

process 1.6 million bpd. However, in the first two months of

this year, they processed an average of 945,000 bpd - above the

612,000 bpd in 2018 they processed before Lopez Obrador took

office but still well below capacity.

With the Dos Bocas refinery set to fully operate this year,

and Pemex also wanting more crude for its other refineries, it

has asked its commercial unit TRI to cut crude exports this

month by 436,000 bpd.

The government plans to continue reducing its exports, which

amounted to 945,000 bpd in the first two months of this year.

Islas reiterated that according to Sheinbaum's plan,

production would be at around 1.8 million bpd of crude oil and

condensate even after there have been few large discoveries of

reserves.

"Smaller reserves are being discovered each time, at greater

depth, with higher costs," said Islas.

"What is being thought about is the energy transition from

fossils to renewables," he said. "Maintain a fixed hydrocarbon

production platform, make better use of the energy and cover the

new demand with renewable energy."

Asked about the finances of the highly indebted Pemex, Islas

said that a Sheinbaum government would look for "aid schemes"

and "better options".

"But support can't be eternal and the company must improve,

show it can be accountable," he said.