Mexico Sets Condition for Sempra LNG Export Permit
MEXICO CITY (Reuters) - Mexico will give the local unit of U.S.-based Sempra Energy an export permit for an LNG facility in northwest Mexico, as long as the company helps offset an oversupply of gas in the area, the president said on Friday.
San Diego-based Sempra has previously signaled that its Mexican unit IEnova is close to obtaining the export permit for the LNG plant at its existing terminal near the northwestern city of Ensenada.
President Andres Manuel Lopez Obrador told reporters at a news conference that he is inclined to approve the permit but stressed what he described as excess natural gas in the area around the northern Pacific coast, given that state-owned power company Comision Federal de Electricidad (CFE) does not use the fuel to generate electricity.
The CFE's plants in the area burn highly-contaminating fuel oil instead.
Lopez Obrador said supply contracts inked by the previous government obliged CFE to buy natural gas that is not needed.
"If we stop buying all that gas that is not used and that we have to pay for, and if (Sempra) helps us export that gas via that plant in Ensenada, then we'd give the permit," said Lopez Obrador.
The comments appeared to walk back the government's interest in requiring IEnova to build a second LNG export facility before approving the pending plant in Ensenada, which was reported by Reuters in August.
Lopez Obrador said a second plant would cost $2 billion and take four years to build.
The LNG export permit would be the first of its kind for a private company in Mexico, with an initial export capacity of some 3 million tonnes per annum of LNG.
It would also likely represent a lucrative means of selling LNG to markets in Asia, where natural gas prices are considerably higher then in the Americas.
Related News
Related News
- PG&E Reduces Emissions from Gas Pipelines by More Than 20%
- Trans Mountain Pipeline Expansion Project to Nearly Triple Current Capacity to 890,000 bpd
- Spain's Tecnicas Reunidas, FCC to Build LNG Terminal Worth $1.1 Billion in Germany
- Canada Offers $26 Billion Green Tax Credits But Still Trails Behind US Incentives
- Pipeline Operator TC Energy Says Keystone Oil Spill Caused by Fatigue Crack
- Pipeline Operator TC Energy Says Keystone Oil Spill Caused by Fatigue Crack
- Permian In Spotlight as Energy Dealmaking Gathers Steam
- Trans Mountain Pipeline Expansion Project to Nearly Triple Current Capacity to 890,000 bpd
- Colombia's Cano Limon-Covenas Pipeline Attacked for Ninth Time in 2023
- Chad Nationalizes Exxon’s 621-Mile Pipeline as Dispute Over Asset Sale Escalates
Comments