Struggling Mexican state oil company Petroleos Mexicanos (Pemex) said on Monday (PEMX.UL) it would issue new debt and receive a capital injection of up to $3.5 billion from the government to help manage its liabilities. Heavily indebted Pemex said in a statement it was planning various measures to improve its financial situation, including offering U.S. dollar-denominated global notes, subject to market and other conditions. Pemex, which reported financial debt of some $113 billion at the end of the third quarter, also said it would conduct "a liability management transaction" of outstanding securities. That transaction would be funded with the capital injection and the global notes, which Pemex called "new money securities." Pemex said it planned to carry out partial exchanges of 12 debt issues maturing between 2024 and 2030, as well as potentially make repurchase offers for six sets of bonds maturing between 2046 and 2060. "Proceeds are expected be allocated initially to the offers to exchange, and any remaining proceeds will be allocated to the offers to purchase," Pemex said. Mexico"s President Andres Manuel Lopez Obrador has made turning around the fortunes of Pemex one of his top priorities as the company grapples with heavy losses and lower crude production. Even if it will improve cash flow in the short term, some questioned whether the new funding would benefit Pemex if it maintains its current business model. "It is not clear that this support is useful to substantially modify the company"s problems," said Arturo Carranza, director of energy projects at Akza Advisors. "There is a risk that the strategy will be erratic and put public finances at risk."