Midstream operators looking to bridge the pipeline infrastructure gap between Texas and Mexico face a whole new set of circumstances to bring Permian and Eagle Ford natural gas to a country dependent on the U.S. for 65% of its supplies. The latest figures show that U.S. LNG exports and pipeline flows to Mexico more than doubled in the first half of 2019 to 3.4 Tcf, becoming the nation’s second-largest destination. This, as Mexico transitions from coal-fired power plants and works to curb the country’s rolling blackouts.

As of September, seven new natural gas pipelines have been identified to transport Texas gas to Mexico, but the process invariably could be slow as a new president comes to the table with more crude oil on his mind to wean the country from foreign dependence. Natural gas has taken a back seat until recently with President Lopez Obrador also announcing in September the resolution of a U.S. gas contract dispute in which the $2.6 billion, 480-mile marine Sur de Texas-Tuxpan Pipeline then commenced service to move 2.6 BCF of natural gas per day from near-Brownsville to power plants in coastal cities in Mexico.

The Sur de Texas-Tuxpan is a joint venture between Mexican subsidiaries of Canada-based TC Energy and San Diego utility Sempra Energy.

According to Obrador’s predecessor, Enrique Pena Nieto, “If you’re a fracker in the Eagle Ford or the Permian Basin, your mouth should water over the Mexican pipeline infrastructure coming online, because it’s going to be one of your biggest outlets for the next 15 years. For however long you can keep up production, Mexico will buy it.”

The latest projections of natural gas consumption by Mexico suggest a 20 percent growth by 2025 from 7.6 BCF to 9.1 BCF per day.

What do you think?


Submit a Comment

Your email address will not be published.

You Might Also Like…