Domestic EPC Pipeline Contractor Aims High

Q: What have been the milestones in Grupo DIDSA’s long history?

A: We took on a number of large pipeline projects in the 1970s and 1980s, involving pipes ranging from 24-48in in size. After this period, projects with smaller pipelines of 2-16in became popular, which resulted in our specialization in these reduced sizes. We have been one of the main pipeline suppliers for Gas Natural Fenosa in Mexico for the past 15 years. As a result, we developed 95% of the natural gas infrastructure in Saltillo, while also participating in projects in Monterrey, the Bajio region, San Luis Potosi, and Aguascalientes. Grupo DIDSA has also developed about 70-80% of the pipelines in the Coahuila area of the Burgos basin and has acquired plenty of experience with key players in the midstream segment such as MPG, GPA Energy, and others. Recently, we finished a project for Grupo Diavaz in Ebano and partnered with GPA Energy to participate in CFE’s Tula projects. We have also developed projects for GDF Suez in states including State of Mexico, Queretaro, Puebla, and Tlaxcala.

Q: How has Grupo DIDSA been diversifying its scope of services now that the market conditions are changing?

A: We are no longer only focusing on our core expertise of building pipelines, as we are now also venturing into compressed natural gas (CNG), among other new business lines. Naturally, we are still looking for opportunities to utilize our pipeline construction capabilities, but along with that we are focusing on other projects related to natural gas. This ties in directly to the evolution of the energy industry in Mexico and the participation of private players in the country’s energy projects. By staying in the same sector yet diversifying our participation, we will be able to tap into more strategic opportunities. The current project that CFE is undertaking involves 42-inch pipes, and although we are not as experienced in this area, we are trying to take on these projects with foreign companies that have the right experience.

Q: What are the main challenges for pipeline construction projects in Mexico at the moment?

A: Access to a skilled workforce and security are issues that we have long had to deal with. For example, we were hired last year by Industrial Perforadora de Campeche to manage the EPC of a project in the Reynosa area. We built 10-20km of pipeline in the middle of nowhere where we attracted unwanted attention and had to secure our people by following a strict security protocol. While we have never let these challenges obstruct a project’s development, we have had to refuse some projects in Tamaulipas due to insecurity.

Q: What benefits would foreign companies entering the Mexican market obtain from associating themselves with Grupo DIDSA?

A: Grupo DIDSA is a medium-sized local company that functions as an EPC turnkey contractor for pipeline projects. In Mexico, there are, at most, ten pipeline construction companies, of which five or six are big. This means that we are among the few companies in Mexico that can handle the construction, operation, and maintenance of pipeline projects, while also obtaining the permits required by CRE to carry out such developments. This fact, coupled with our local expertise, makes it evident that foreign companies coming into Mexico will see Grupo DIDSA as a reliable partner that is fully aware of Mexican compliance requirements for these types of projects. Furthermore, this country is going to gasify itself. Given that we have been building natural gas pipelines for many years, we aim to be there at the right time, in the right projects, and with the right partners. This is why we sought out GPA Energy, a Mexican company that is very important in its field of work, for the Tula project. We are also looking to involve ourselves in a new, small project called Villa de Reyes. We want to develop win-win relationships with new players in order to complement our local expertise with their extended capabilities. We are a reliable mid-sized company that is thinking big, but we will have to be clever and ambitious in order to scale up. At the moment, one of the biggest Chinese companies that is looking to enter the Mexican energy market is interested in working with a company like us. After all, no company will venture into Mexico without a trustworthy partner. Through this strategy we intend on riding the first wave of projects resulting from the Energy Reform.