Mexico Increases Natural Gas Production To Meet Domestic Demand

Mexico has become exceedingly reliant on US imports to fulfill its natural gas demand. On the back of recent geopolitical developments, the country has gained awareness of the vulnerabilities that deficient domestic natural gas production poses to its energy security. Therefore, the government is implementing strategies to raise national production.

Data shared by the Economic Commission for Latin America and the Caribbean (ECLAC) showed that Mexico had drastically decreased its natural gas production over time, as it was more economically attractive to import gas from the US through multiple pipelines. Moreover, Mexico’s conventional reserves of natural gas are limited in comparison with its oil reserves.

However, recent events showed how vulnerable Mexico has become when the natural gas supply from the US stops. During the winter storm in February, 2021, Texas suspended natural gas exports to Mexico to focus on its own emergency. The lack of supply caused energy shortages in Mexico’s northern states and caused a peak in energy prices.

After gaining this awareness, Mexico started to push a strategy to increase its domestic natural gas production in an attempt to reduce reliance on imports. Recent data reported by the National Hydrocarbons Commission (CNH) showed that during July 2022, natural gas production increased by 6.1 percent in Mexico compared to July 2021. In total, Mexico increased its domestic natural gas production by 15 percent during the first seven months of 2022 compared with the same period in 2021. The recent increase in Mexico’s domestic production was driven primarily by the Quesqui and Ixachi fields.

Nevertheless, natural gas imports from the US keep growing. Information shared by the US Energy Information Administration (EIA) showed that pipeline exports of natural gas from West Texas to Mexico averaged 1.6bcf/d in May 2022, the largest pipeline export from West Texas on record.

Discussions around Mexico’s options to reduce its dependency on imported natural gas remain open. Topics like these and more surrounding the current state of the Mexican energy sector and the trends that lie ahead will be discussed by decision-makers and key players at Mexico Natural Gas Forum 2022. The forum is followed by Mexico Energy Forum 2022 ECHO. Both platforms represent a unique opportunity to debate relevant issues surrounding Mexico’s main fuel for power production and the opportunities the industry holds to diversify.

During Mexico Energy Forum 2022 ECHO, key stakeholders will share their insight regarding these issues, making the forum an event you will not want to miss.

Mexico Business is proud to extend an invitation to the first edition of the Mexico Natural Gas Forum, on Sept. 6, 2022, and the eleventh edition of the Mexico Energy Forum 2022, on Sept. 7 and 8, 2022. Throughout the three-day event, the industry’s most important leaders, investors, and decision-makers will gather to discuss the sector's future and develop new business opportunities.