The American export of gas pipeline is increasing with new pipelines in Mexico



The export of natural gas pipelines to Mexico in the US has increased as a result of expansions of cross-border pipeline capacity. These exports averaged 4.2 billion feet3/ d in 2017 and 4.4 billion ft3/ d until the first five months of 2018. Based on data compiled by Genscape, exports of natural gas to Mexico per pipeline amounted to more than 5 billion feet3/ d for the first time in July 2018, after the commissioning of several important pipelines in Mexico. By the end of 2018, four additional four of the six major pipelines identified as strategic in the five-year expansion plan for expanding the natural gas infrastructure will start operating commercially.

These new pipelines will transport the US natural gas to the central and southern regions of Mexico and be an additional outlet for the limited production of Perm in Western Texas. The export of natural gas from the US will help meet the growing demand of natural gas-fired power plants and industrial sectors in Mexico, compensating for the decline in Mexican domestic production.

Source: US Energy Information Administration, based on Mexico's Secretaría de Energía Status of pipelines (in Spanish), IHS Markit, Genscape and trade press

Currently, about three-quarters of US exports of natural gas pipelines flow to Mexico from South Texas. Exports from South Texas averaged 3.2 billion feet3/ d in 2017 and 3.3 billion ft3 / d through the first five months of 2018. This natural gas originates mainly from the Eagle Ford Basin in Texas and is transported on an existing pipeline network for industrial and energy sector customers in northeastern Mexico.

However, exports from Western Texas were limited, despite a significant increase in cross-border pipeline capacity from 2015 to 2017. Exports from Western Texas averaged only 0.4 billion ft3 / d in 2017 and 0.5 billion feet.3/ d in January – May 2018. Substantial delays in the construction of the connecting pipelines on the Mexican side of the border have led to a relatively low utilization of cross-border pipeline capacity from Western Texas. Some pipelines in Mexico have been delayed by more than a year compared to their original expected in-service dates, partly because of disputes over pipeline routes.

Several important pipelines in Mexico were put into operation earlier in 2018. La Laguna-Aguascalientes (1.2 billion feet3/ d) and Villa de Reyes-Aguascalientes-Guadalajara (0.9 billion feet3/ d) are scheduled to start commercial activities in November 2018 after the interconnection in El Encino-La Laguna is completed in October. These pipelines transport natural gas from Western Texas to the middle and west of Mexico via the Ojinaga-El Encino and Tarahumara pipelines.

Natural gas from these pipelines can displace liquefied natural gas (LNG) at the Manzanillo LNG terminal and serve the markets in Guadalajara, the second largest city in Mexico. Samalayuca-Sásabe (0.5 billion feet3/ d capacity) is planned to start commercial activities in November 2018 and will mainly serve new natural gas-fired power stations in western Mexico.

Additional export capacity from southern Texas totaling 3.0 billion feet3/ d will start commercial activities later this year. The American Valley Crossing (also called Nueces-Brownsville) pipeline (2.6 billion ft3/ d capacity) will connect to the Mexican Sur de Texas-Tuxpan submersible pipeline. Both pipelines are expected to be taken into use in October 2018.

However, the pipelines on the other side of this underwater pipeline have been delayed. The Tuxpan-Tula pipeline (0.9 billion feet3/ d capacity), which connects Sur the Texas-Tuxpan with markets in central Mexico, has been delayed and is expected to be operational not earlier than 2020. Another pipeline near Mexico City – Tula-Villa de Reyes (0.9 billion feet)3/ d) – has been postponed until 2019. Until these pipelines start commercially, it is expected that the much-needed market around Mexico City will continue to be served by the existing pipeline infrastructure that transports natural gas from the south of Texas.

Read the article online at: https://www.worldpipelines.com/business-news/22082018/us-gas-pipeline-exports-increase-with-new-pipelines-in-mexico/


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