Fermachem Breaks Ground in Durango

The formal launch of Fermaca Dreams' MX$28 billion (US$1.5 billion) Fermachem Agro-Nitrogen Industrial Complex in Durango, coupled with PEMEX's MX$93 billion petrochemical reactivation plan, marks a major private-public mobilization to establish domestic fertilizer production. Leveraging competitive natural gas supply secured through Esentia Energy Systems, the highly advanced facility targets an annual output of one million tonnes of granulated urea to substitute 58% of national imports. This strategic pivot aligns directly with the federal administration's energy and food sovereignty mandates, mitigating structural import vulnerabilities for Mexico's agricultural sector while expanding industrial nearshoring infrastructure.

Fermaca Dreams formally launched construction of the Fermachem Agro-Nitrogen Industrial Complex in the community of Sapioris, municipality of Lerdo, Durango on June 8, the same day PEMEX announced its own MX$93 billion petrochemical and fertilizer reactivation plan in Veracruz. The simultaneous announcements represent the most concentrated investment commitment to domestic fertilizer production Mexico has seen in a generation, arriving at a moment when the Sheinbaum administration has made food and energy sovereignty a defining pillar of its industrial strategy.

The project represents an investment of MX$28 billion (US$1.5 billion) and is projected to produce 1Mt of fertilizer annually, generating more than 3,000 jobs during construction and approximately 450 permanent positions once operational. Governor Esteban Villegas Villarreal described the project as one of the most important achievements of his administration and "a before and after for Durango."

Fermachem will be one of the most modern plants on the continent, according to CEO Ray Fletcher, who also highlighted that Durango was selected for its strategic location, competitive access to natural gas, and conditions of confidence for large-scale industrial development.

The complex will include autogeneration of electricity and a carbon capture system to mitigate its environmental impact. The gas supply for the plant has been secured through an agreement with Esentia Energy Systems, the company that operates the natural gas transport infrastructure originally developed by Fermaca. That gas supply security is the project's single most important logistical foundation: nitrogenous fertilizer production is gas-intensive, and Durango's access to competitively priced natural gas via Esentia's pipeline network is what makes the economics viable at this location.

According to data from the National Association of the Chemical Industry, Mexico imported 1.7Mt of urea in 2024. Fermachem's projected annual output would be equivalent to 58% of those imports, a structural reduction in a dependency that currently sees Mexico sourcing more than 80% of the urea it consumes from abroad.

A social investment of more than MX$200 million for community benefit actions in Lerdo and Durango is embedded in the project commitment, with Fernando Calvillo Álvarez, Co-President,  Fermaca Dreams, framing food sovereignty as the project's primary purpose alongside employment creation and regional development.

Fermaca's Strategic Pivot

The Fermachem plant represents a significant evolution for Grupo Fermaca, which built its business as a natural gas infrastructure developer, most notably as the original developer of the pipeline network that connects northern Mexico to US gas supply and that now operates under Esentia Energy Systems following a sale to KKR-backed infrastructure investors.

Fernando Calvillo and Manuel Calvillo Álvarez, Co-President, Fermaca Dreams, drove the project in coordination with Durango's state government and the federal government over several years of negotiations and site selection. The decision to use the same gas infrastructure they originally built as the supply backbone for a fertilizer manufacturing complex is a vertically integrated industrial logic, converting gas access into agricultural chemicals, a value-added segment with domestic demand that Mexico has historically outsourced.

Two Plants, One Policy

The Fermachem groundbreaking comes less than 24 hours after PEMEX Director General Juan Carlos Carpio and SENER Minister Luz Elena González unveiled the MX$93 billion Comprehensive Reactivation Plan for the Petrochemical and Fertilizer Industry at CMP in Veracruz. PEMEX's flagship project within that plan, a MX$25 billion ammonia and urea plant in Poza Rica, targets 708,000t of granulated urea annually.