Companies expressed interest in injection points that push U.S. natural gas into Mexican pipelines during transportation capacity auctions in that country in the last year, the U.S. Energy information Administration said.
The EIA's June 8 "Natural Gas Weekly Update" covered Mexico's first open seasons for transportation capacity rights on the country's natural gas transportation and storage system. Mexico's National Center for Natural Gas Control, or CENAGAS, hosted two open seasons: one round in October 2016 and a second round on May 8, 2017. The public entity manages Mexico's gas grid, which has 6,256 miles of pipeline capable of transporting 6.3 Bcf/d. CENAGAS took over the system from PEMEX Gas y Petroquímica.
The EIA expected the demand for such capacity to outpace supply. Kinder Morgan Inc.'s Kinder Morgan Texas Pipeline LP interconnect at Pesqueria and the Ramones delivery point connected to the NET Mexico Pipeline Partners LLC system are two of the most oversubscribed injection points, the agency said.
Companies that bid on transportation capacity will have until mid-June to sign contracts with CENAGAS. The capacity contracts will last until June 30, 2018.
Of the total gas transportation capacity on the gas grid, CENAGAS auctioned 4.1 Bcf/d in the first round. About 1.1 Bcf/d went to Mexico's Comisión Federal de Electricidad, 1.4 Bcf/d went to PEMEX, and 1.6 Bcf/d went to independent power producers in the country.
In the second round, 24 local and international companies requested 3.6 Bcf/d, the EIA said, but CENAGAS allocated only the available 2.2 Bcf/d. PEMEX secured the majority of the remaining capacity. It received 59% of the available capacity. Energy and gas provider ENGIE and steel manufacturer ArcelorMittal received 7% each of the awards. Shell Trading Co. in Mexico was awarded 6%, Grupo Alpha got 5%, and the remaining 338 MMcf/d was awarded to 19 other companies, including various gas retailers.