Daniel Georges Vadon
Managing Director
Entrepose Mexico
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View from the Top

Underground Storage, a Solution for the Mexican Market

Tue, 01/21/2020 - 20:05

Q: Why did Entrepose decide to enter Mexico and what has been the company’s standout project since its arrival?

A: The Energy Reform gave Entrepose the perfect opportunity to enter Mexico. At the same time, the need for hydrocarbons storage to stock the strategic reserves that the country lacked became clear. The market’s liberalization and its need perfectly suited Entrepose. Between 2015 and 2017, Entrepose constructed Mexico’s first underground LPG storage plant at a greenfield site in Coatzacoalcos, Veracruz for a private client. We carried out the feasibility study and the EPC contract, both of which were technically challenging due to the area’s soil and the novelty of the project in Latin America. The cavern has a volume of 300,000m3, capable of storing 2MMb of LPG. The first cavern is now completed. We are now operating the site and have a long-term contract to do so. Underground storage is an interesting option in Mexico because it is both cheap and does not require masses of land. It is also out of the way. Its popularity and applicability can be seen in Texas and depleted oil fields can be repurposed for use.

Q: How does the company benefit the Mexican industry and what are its areas of interest?

A: Entrepose Group is a member of the VINCI Group, the world’s leading integrated concession-construction group. We offer a full host of EPC services, focusing primarily on the shallow water and onshore environments within Mexico. In 2018, our global revenue was approximately US$800 million. Entrepose’s ability to combine onshore EPC and offshore EPC to provide a single, integrated EPC service delivers a high-end quality service that is extremely competitive. This approach allows us to optimize project execution, thanks to an overall view of project management, reducing the number of interfaces. This way, clients benefit from solutions that are more flexible and straightforward. For instance, in projects involving an offshore and onshore part, the interface between both is one of the most sensitive parts in terms of planning and companies involved in. Entrepose can coordinate both parts internally, thus optimizing cost and schedule. These are not specialties offered by most EPC companies in Mexico. Within the Entrepose Group, we have a selection of subsidiaries that we bring together to form this streamlined, integrated contraction option. Besides Entrepose Mexico, which is primarily an EPC contractor, there is also Geostock, which operates and maintains underground storage facilities for the oil and gas industry. HDI Latam carries out horizontal directional drilling (HDD) for pipeline work and is growing rapidly in Mexico due to the country’s environmental constraints, which prohibit trenching of the shore approach. HDD enables a more environmentally-friendly way of connecting the sea line to the onshore pipeline. In 2018, HDI worked on the shore approaches on South of Texas-Tuxpan pipeline landfall project and completed several HDD jobs.

Q: What milestones mark the company’s success in the area of health and safety?

A: Safety is Entrepose’s No. 1 priority. We are proud to have achieved 3.5 million man-hours without an accident reported in Mexico. We focus heavily on HSE because we want every person on site to leave safely and because our clients demand the highest standards. In the Mexican market, where many internationals now operate, high-level HSE standards are essential. We have reduced our Total Recordable Injury Frequency Rate from 6.80 in 2012 to 2.30 in 2017, while reducing the Lost Time Injury Frequency Rate from 1.87 to 0.60 within the same time frame.

Q: Where along the value chain has Entrepose identified its business opportunities?

A: Most of the opportunities we identify as suitable for our skillset are in the upstream and midstream sectors. There is a focus on import terminals because the country is missing some import capacities and this presents opportunities to us with private clients to which we can offer the full, integrated Entrepose package. Oil field development, both onshore and offshore, is one definite area of potential.

 

Entrepose Group is an international contractor headquartered in France that designs, builds and operates production, transport and storage infrastructures for the oil and gas and other energy markets.