Howard Energy Partners has begun injecting natural gas into its 36-inch-diameter Impulsora pipeline as it readies the crossborder segment for full service later in June, a connecting downstream pipeline in Mexico and an intrastate segment in Texas, a company official said Wednesday.
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The initial injection of gas on the crossborder segment is part of the start-up process, said spokeswoman Meredith Howard. "We expect the system as a whole to be operational later this month."
The combined system entails about 190 miles of minimum 30-inch-diameter pipeline stretching from Webb County, Texas, to Monterrey, Mexico.
US gas exports to Mexico have averaged just over 4.3 Bcf/d so far in 2018, up 0.3 Bcf/d or 8% compared with the same period last year, according to S&P Global Platts Analytics.
While US exports to Mexico have broken above 4.4 Bcf/d in June, pipelines remain heavily constrained downstream, and Mexico has remained reliant on LNG imports and fuel oil to supplement its declining domestic output.
NUEVA ERA SYSTEM STRETCHES TO MONTERREY, MEXICO
Impulsora has an agreement with anchor shipper Comision Federal de Electricidad to ship 504 MMBtu/d to the border, where the 1,400-foot crossborder segment connects with a 171-mile pipeline operated by Midstream de Mexico that runs to Monterrey, Mexico.
Both pipes are part of the Nueva Era pipeline system, a joint venture between San Antonio-based Howard Energy Partners and Mexican energy company Grupo Clisa that will deliver US gas to users in and around Monterrey. A 17-mile intrastate pipeline segment is also located in Webb County, Texas.
The Nueva Era system connects with the Huinala power plant in Monterrey, and will later serve a planned 890-MW power plant in Escobedo.
According to a report by Mexico's energy ministry (SENER), the units at the Huinala complex include two combined-cycle units totaling 471 MW of capacity and one 150-MW internal combustion unit.
The Huinala units are currently in service, but will change their supply source to Nueva Era when the pipeline is online, Howard said. Assuming a heat rate of 7 MMBtu/MWh and 60% utilization, the combined-cycle units could consume roughly 50 MMcf/d.
"Pursuant to its commitment to notify the [US Federal Energy Regulatory Commission] within five business days of the project flowing natural gas, Impulsora hereby notifies the commission that the project began injecting natural gas on May 30, 2018," the company told FERC Monday.
MEXICAN PIPES MOVE TOWARD SERVICE, DESPITE DELAYS
There are currently nine major gas pipelines under construction in Mexico, which are expected to help to alleviate import constraints once brought online. However, the pipelines are facing an average delay of over 400 days, primarily due to legal injunctions filed during construction.
The Nueva Era pipeline was originally set to enter service in the second half of 2017, but the in-service date was subsequently delayed until the third quarter of 2018.
The most recent pipeline status report released by SENER indicates that all remaining gas pipeline projects are expected to be in service before the end of the year, providing a major upside for US exports to Mexico and allowing power generators to reduce their consumption of fuel oil and reduce their dependence on LNG.
US gas exports to Mexico could reach 4.9 Bcf/d by late 2018 and average 5.7 Bcf/d by 2019, according to Platts Analytics.