US-Mexico Trade Tensions PersistBy Cas Biekmann | Thu, 04/08/2021 - 17:55
Gas imports from the US are set for records highs. Could Mexican production fill the gap instead? In other news, trade relations and business deals in the renewable and natural gas area come into focus.
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Gas Imports Set for Record; Could Mexican Production Ignite?
With Mexico’s dependence on natural gas to power its energy mix, the post-pandemic reactivation in the country is set to detonate US dry gas record imports. The cross-border flow of gas continues to show clear growth, leading experts to question Mexico’s efforts to produce its own resources. Natural Gas Intelligence (NGI) reported that Mexican imports are expected to average 6.3Bcf/d for the summer months, up 800MMcf/d compared to 2020. Domestic natural gas production has been underperforming, resulting in the need to import more natural gas.
Trade Conflicts Persist Between Mexico and the US
The Office of the US Trade Representative (USTR) presented its report “Foreign Trade Barriers 2021” and suggested that Mexico and the US are having complicated trade relationships, Reuters informs. The report states that "the US has raised concerns with Mexico regarding the deteriorating climate for US energy investors in Mexico, emphasizing that the US government is committed to ensuring that US investors are treated fairly and that Mexico adheres to its USMCA commitments." The report also informs that US foreign direct investment in Mexico (stock) was nearly US$100.9 billion in 2019, a 5.2 percent increase from 2018.
Monitoring, Warning System Decreases Hydro’s Flood Risks
Representatives from state-owned utility CFE, grid operator CENACE and President López Obrador took part in the ‘Program to Support People Affected by Floods in Tabasco’ on Mar. 31. As part of the program, they presented a monitoring and warning system at the Grijalva River dam, considered a key element to CFE’s future power production plans focused on hydroelectricity.
Cox Energy to Acquire 40 Percent Stake in Ibox Energy
Mexico City-based Cox Energy acquired 40 percent of Spanish photovoltaic solar player Ibox Energy in a transaction designed to gain foothold in the European market as well, reported Renewables Now. The transaction is valued at US$112.8 million. Cox Energy aims to diversify markets, currency and regulatory risks by spreading out across the globe in line with its 2020-2024 business plan.
KKR Acquires Stake in Sempra’s Mexican and US LNG Portfolio
KKR, an international investment firm, plans to buy a stake in Sempra Energy’s natural gas liquefaction portfolio. KKR will pay US$3.37 billion for a 20 percent non-controlling interest in the business, which includes Sempra’s LNG unit that had earlier on merged with Sempra’s Mexican unit, IEnova, Natural Gas Intelligence reported.
BayWa r.e. Gains New Shareholder
For a contribution in equity of US$630.3 million, Swiss investor Energy Infrastructure Partners (EIP) purchased a stake of 49 percent in the German renewable company BayWa r.e., Renewables Now reported.