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(Bloomberg) -- Mexico’s budget includes 263.5 billion pesos ($14.1 billion) for its embattled state oil company Petroleos Mexicanos to cover debt expenses in 2026, the latest in a string of financial lifelines for the debt-ridden driller.

The company’s proposed budget for next year totals 517.4 billion pesos ($27.7 billion), 7.7% higher than 2025, according to the document.

Mexico expects the company’s oil output to reach 1.8 million barrels per day next year, with an average oil cost of $54.9 per barrel. Oil exports are forecast at 521,000 barrels per day, the budget showed.

The support comes after Pemex raised $12 billion in financing via the issuance of so-called pre-capitalized notes in July, and announced plans for a $13.3 billion investment vehicle funded by local banks. Earlier this month it also proposed a $10 billion buyback operation designed to cancel out Pemex’s massive wall of maturities coming due next year.

To be sure, the budgetary support for Pemex isn’t new for Mexico, which has propped up the struggling state oil driller in recent years. President Claudia Sheinbaum granted the company $6.7 billion in support for 2025, while her predecessor Andrés Manuel López Obrador granted about $80 billion in cash injections and tax breaks over the course of his six-year term. Overall, the infusion from the previous administration did little to stem the company’s slide in production.

Spencer Cutter, a Bloomberg Intelligence credit analyst, said that recent government-backed moves like Pemex’s buyback offer are positive signs, though questions remain.

“Even after eliminating more than $20 billion, Pemex is still going to have more than $75 billion in debt, and that’s not including supplier and employee obligations,” Cutter said. “So while it’s a strong start, the company still has a long way to go. And none of it really matters unless they can address the operational challenges as well.”

Pemex has been the crown jewel of the Mexican state since it was created in a wave of nationalizations almost 90 years ago. But after years of underinvestment and mismanagement, the company is carrying a staggering $100 billion-plus debt load, and its crude production has plummeted to roughly half of what it was at its peak 20 years ago.

While Pemex’s finances appear more secure in the short term, it’s unclear if the financial support will boost output. Last month, the company unveiled a comprehensive business plan to outline how it will reach a production target of 1.8 million barrels of crude per day, plus 5 billion cubic feet of gas. Analysts called the plan insufficient to reverse the downward trend.

Now, Pemex is seeking to build partnerships with private companies to drill its aging wells and tap offshore deposits. It’s also considering increasing fracking to tap Mexico’s vast shale reserves.

Pemex has so far signed 11 agreements with private companies to enter into partnerships, according to a government document released last week, which didn’t give further details on the projects or Pemex’s partners.

--With assistance from Kelsey Butler and Maya Averbuch.

(Adds Pemex’s proposed 2026 budget in the second paragraph, and more background from the fifth paragraph)