Mexico Pacific plans to produce 14.1 million tonnes of liquefied gas in Mexico
Mexico Pacific is investing US$14 billion to build a liquefied natural gas plant in Mexico. The project also includes the construction of a gas pipeline from the US.
The LNG plant will be located on the Pacific coast. It will have three lines with a total capacity of 14.1 million tonnes of liquefied gas per year. There will be a fuel storage facility and a jetty on the site. The plant’s location is determined by the fact that Mexico Pacific’s main importers are Asian countries. This will allow the company to supply gas to the region via a short route without transporting it through the Panama Canal. Mexico Pacific has already signed contracts with Asian customers to export LNG, so the company is in a hurry to start production as soon as possible.
Construction has begun after partners agreed all formalities regarding the level of investment and the work progress. According to agreements, all three lines will be operational in 2026. In total, the process from project review to implementation took 18 months. Raw materials for the Mexico plant will be sourced from the US.
Mexico Pacific partners
In April 2023, Guangzhou, which supplies gas and electricity to a province in China, signed a contract with Mexico Pacific to purchase liquefied natural gas. Under the agreement, the producer will supply 2 million tonnes annually for 20 years. In addition to Guangzhou, the US company has signed contracts with other major Asian customers.
The producer notes that it has not yet entered emerging markets but plans to do so in the future. Looking at the global situation, Mexico Pacific has seen increased demand for LNG from European importers. This, in turn, is prompting American producers to increase production and look for ways to supply new customers without losing old ones in Asia.
Mexico Pacific has also signed a 20-year contract with Shell Corporation. The latter will purchase 2.6 million tonnes of LNG per year. Supplies will come from a new plant in Mexico. The raw material for the plant is extracted from a mine in Texas.
In July 2022, for the first time in the history of the LNG industry, the US became the leading exporter of LNG to Europe. The main factor was the sanctions imposed on the region’s largest fossil fuel supplier as a result of its unleashing a geopolitical conflict.