Shale Daily / NGI All News Access

Pipeline Would Link Eagle Ford Gas to Mexico Power Plants

NET Midstream unit NET Mexico Pipeline LP plans to build a 124-mile, 42-inch diameter natural gas pipeline to carry gas produced in the Eagle Ford Shale of South Texas to the Texas-Mexico border.

The project would be anchored by a long-term firm gas transportation agreement for up to 2.1 Bcf/d, with MGI Supply Ltd., a unit of Pemex Gas y Petroquimica Basica (Pemex), Mexico's state-owned gas company.

NET Mexico would transport gas from the Agua Dulce Hub in Nueces County, TX, to a point near Rio Grande City, TX, in Starr County. The pipeline could enter service in December 2014.

Net Midstream Co-President Joe Gutierrez said the Eagle Ford gas would serve power generation markets in Mexico.

Net Midstream operates three pipeline systems in the Eagle Ford. The Eagle Ford Midstream is a 150-mile, predominantly 30-inch diameter intrastate natural gas pipeline that provides gas transmission for the Brasada Processing Plant in LaSalle County, and transports pipeline-quality gas from producers in the Eagle Ford Shale to the Agua Dulce Hub. LaSalle Pipeline is a 52-mile, 16-inch diameter pipeline that provides the full gas supply requirements for a 200 MW power generation facility in Pearsall, TX. South Shore Pipeline is a 30-mile pipeline serving Corpus Christi, TX, under a long-term gas supply and transportation contract.

"NET Mexico is a natural next step in our pipeline system, as we connect abundant gas supply from the Eagle Ford Shale to expanding power generation and industrial markets in Mexico," Gutierrez said.

Pipeline development activity to serve demand in Mexico has been on the increase of late. TransCanada Corp. was recently awarded a contract for projects in Mexico (see Daily GPI, Nov 6, 2012; Nov. 2, 2012). Kinder Morgan's El Paso Natural Gas recently inked a 25-year transportation agreement related to plans to expand gas service to northern Mexico (see Daily GPI, Nov. 16, 2012).

NET Midstream is a unit of NET Holdings Management LLC, a privately held natural gas midstream and marketing company. The Company owns six intrastate gas pipelines in Texas and markets gas across the United States.

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