Sempra, CFE and Carso Sign MOU to Build Natural Gas Pipeline
Sempra Infrastructure, CFE and Grupo Carso signed a memorandum of understanding (MOU) to build a natural gas pipeline in Sonora and Baja California, interconnecting Carso’s Samalayuca-Sásabe and Sempra’s and Sásabe-Guaymas pipelines.
The proposed pipeline would be about 450km and aims to deliver natural gas to CFE power plants as well as to industries and private offtakers. The agreement is preliminary and non-binding, subject to feasibility studies, permits, financing and board approvals.
“Additionally, this Strategic Alliance would allow CFE to optimize the natural gas transportation system that it has contracted in the US and in Mexico to offer power plants, industries and consumers in the region, a safer, more efficient, competitive and reliable supply of natural gas,” announced Sempra.
Mexico also aims to promote itself as a key hub for exporting liquefied natural gas (LNG) to Asia and Europe, where prices are currently higher. A strongly interconnected pipeline network would allow the state utility and private players to capitalize on this potential.
Different companies are interested in LNG re-exporting, including Sempra, Mexico Pacific Limited, particularly on Mexico’s West Coast to woo Asian buyers with plenty of demand. “What we are seeing is a fast-track in the regulatory aspect of the US in Mexican territory to be able to send gas to Asia,” said Norberto Catalán, Trading Director, Énestas to Energía a Debate.
CFE furthermore reported it is addressing natural gas supply challenges and investigating unfavorable offtake contracts. According to the report, 75% of the natural gas supply is linked to unfavorable contracts signed previously. The CFE noted that it now uses 40% of the contracted natural gas transportation capacity, a significant increase compared to the 26% used during the previous administration.