IEnova Expects Mexican Export Permit for Costa Azul LNG This Year
(Reuters) — Infraestructura Energética Nova SAB de CV (IEnova) still expects to get an export permit from Mexico soon that will allow it to make a final investment decision (FID) this year to build its Costa Azul liquefied natural gas (LNG) export plant.
IEnova, a unit of U.S. energy company Sempra Energy, has been waiting for the 20-year export permit all year. It has been held up in part by the coronavirus.
"We continue to work closely with the federal government to obtain the export permit and ... have final investment decision shortly," IEnova Chief Executive Tania Ortíz Mena López Negrete told analysts in an earnings call on Thursday.
Oil and gas companies around the world have pushed back decisions this year to build new LNG terminals after global demand for energy collapsed due to the coronavirus.
Investment demand in LNG had been running high for several years due to heavy consumption from mostly Asian countries to meet growing energy demand and diversify fuel sources away from dirty coal toward cleaner gas and renewables.
Costa Azul's Pacific Coast location gives it an advantage over U.S. Gulf Coast export facilities in reaching those Asian markets. U.S. plants usually ship LNG to Asia through the Panama Canal.
At the start of 2020, a dozen or so North American LNG developers said they planned to make FIDs to build projects by the end of this year. Currently, however, that total is down to just two, and some analysts have said they expect only Costa Azul to actually go forward this year.
Sempra and IEnova plan to build the export facility, expected to cost about $1.9 billion, at the existing Costa Azul LNG import plant, which entered service in 2008.
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