New pipeline to triple Mexican gas imports

The construction of a natural gas pipeline from southern Texas to central Mexico for state-owned oil company Petroleos Mexicanos, or Pemex, will allow gas imports from the U.S. to triple, to around 3BCF per day by 2015 to meet increasing demand by industry for the relatively cheap fuel, a Pemex official said Wednesday. Alejandro Martinez Sibaja, the director of Pemex’s gas division, said in an interview that Mexican industry is currently hampered by its reliance on more expensive fuels because of the lack of pipeline capacity for natural gas from across the border.
“The lack of gas means that our industries are having to burn fuel oil, which is currently about three times as expensive as natural gas,” Martinez said. The gas supply problem is expected to be alleviated with the Los Ramones project, a pipeline that will carry gas from southern Texas to the central Mexican state of Guanajuato, which is a hub for the Mexican auto industry. Pemex plans to release bidding rules next week for the longest part of the pipeline, a 740-kilometer (460-mile) stretch from Nuevo Leon to Guanajuato. Martinez said the estimated cost of section of the pipeline being tendered is about USD 1.8B. The first two sections of the pipeline have already been assigned. The 200km section from the Agua Dulce gas hub in Texas to the Mexican border will require an investment of about USD 800M, and the 114km section from the border to the Ramones gas hub in Nuevo Leon state will cost about USD 600M, he said.
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