Mexican president pushes hopes for pipeline deal into next week

FILE PHOTO: Mexico's President Andres Manuel Lopez Obrador attends a news conference at the National Palace in Mexico City, Mexico July 22, 2019. REUTERS/Edgard Garrido

MEXICO CITY (Reuters) - Mexican President Andres Manuel Lopez Obrador said on Thursday a deal could be reached next week with companies to end a contractual dispute over several natural gas pipelines, dialing back hopes for a quicker resolution.

“It’s going well, that business,” Lopez Obrador told reporters at his regular morning news conference after the latest round of talks with companies on Wednesday. “And I expect that next week a deal will be reached.”

The dispute over contracts signed under the last government involves firms including Canada’s TC Energy Corp, Mexico’s Grupo Carso, a company controlled by billionaire Carlos Slim, and IEnova, a Mexican unit of U.S. business Sempra Energy .

Earlier this week, Lopez Obrador said an agreement might be possible as soon as this Thursday on the dispute, which has caused diplomatic tension with Canada in particular.

State-run power utility the Federal Electricity Commission (CFE) has driven the bid to renegotiate the pipeline contracts, arguing that their terms were unfair.

The dispute has exacerbated concerns that Lopez Obrador, a veteran leftist who took office in December, could call into question any contracts signed before he assumed the presidency.

Lopez Obrador rattled markets when he abruptly canceled a partly-built $13 billion Mexico City airport a few weeks before taking office, arguing the project was riddled with corruption.

Reporting by Dave Graham; Editing by Nick Zieminski