FERC Greenlights Saguaro Pipeline for Gas Exports to Mexico

The US Federal Energy Regulatory Commission (FERC) has given the green light to the construction of the Gasoducto Conector de Saguaro (Saguaro Connector Pipeline), by Saguaro Connector Pipeline LLC. This marks a pivotal step in facilitating natural gas exports from the United States to Mexico. 

The pipeline, championed by Saguaro Connector LLC, a subsidiary of ONEOK, Inc., is set to span approximately 1,000ft with a diameter of 48in. It will traverse from the US-Mexico border in the middle of the Rio Grande to a site about 18 miles southwest of Sierra Blanca in Hudspeth County, Texas.

According to FERC documents, the Border Facility, to be constructed as part of the pipeline project, will boast a capacity of approximately 2.834Bcf/d and a maximum allowable operating pressure of 1,480lb/in2. The estimated cost for the installation of the Border Facility stands at US$9.5 million. 

Additionally, Saguaro Connector LLC plans to interconnect the pipeline with a new interstate pipeline, dubbed the Connector Pipeline, entirely situated within Texas. This new pipeline will transport natural gas from an existing interstate natural gas pipeline in Pecos County, Texas, to the Border Facility, enhancing connectivity and streamlining gas transportation processes.

The significance of this project extends beyond US borders, particularly due to its direct connection to Mexico's energy landscape. The Saguaro Energía project, spearheaded by Mexico Pacific Limited, is poised to revolutionize Mexico's energy sector. This transformative initiative includes the development of a gas liquefaction terminal in Puerto Libertad, Sonora, with an investment projection of US$14 billion. The terminal is designed to process up to 15 million mt of liquefied natural gas annually, aiming to commence operations by 2028.

Sonora Governor Alfonso Durazo has lauded the progress made in the development of the gas liquefaction plant, emphasizing its role in bolstering Mexico's energy infrastructure, and establishing critical ties with the Asian market. “The construction project is proceeding smoothly, with positive developments in all aspects. Fortunately, all permits, procedures, and authorizations have made considerable progress, particularly along the entire pipeline route. This is excellent news for our state, representing an investment of around US$15 billion," said Durazo.

The terminal, strategically located in Puerto Libertad, holds promise not only for economic growth but also for positioning Sonora as a key player in the global natural gas liquefaction industry. With regulatory clearances in place and construction advancing steadily, the project is expected to create significant employment opportunities, with an estimated 13,000 direct jobs and 21,000 indirect jobs anticipated.

Undoubtedly, this project, an integral component of the Sonora Plan, is set to position the state prominently on the global map of the natural gas liquefaction industry, said Durazo. He emphasized that Sonora is poised to become a primary destination for investments by companies dedicated to advancing the energy transition.