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CenterPoint to Provide Oversight for Tidelands' Mexican Gas Infrastructure Project

Tidelands Oil & Gas Corp. has signed a consulting services agreement with CenterPoint Energy Pipeline Services, which will provide expertise in the design and development of Tideland's ambitious gas infrastructure project in Northeastern Mexico. The project, which will be the first of its kind in the country, will involve construction of two large diameter border crossing pipelines, a gas storage and pipeline hub, another pipeline to industrial customers in Monterrey and an offshore liquefied natural gas (LNG) import terminal.

Tidelands also entered into a letter of intent with the CenterPoint Energy subsidiary to provide oversight for the construction, operation and maintenance of the integrated pipeline, storage and LNG project, pending a definitive agreement between the two companies.

Tidelands said that it brought CenterPoint Energy on board because of its experience operating two affiliate natural gas pipelines: CenterPoint Energy Gas Transmission and CenterPoint Energy-Mississippi River Transmission. The two pipeline systems extend 8,200 miles and include six underground natural gas storage facilities and more than 350,000 horsepower of compression in six states.

"CenterPoint Energy's sustained reputation for dependability has prompted us to engage their consulting services to investigate and evaluate the intricate details of our proposed pipeline, storage facility and LNG Project," said Tidelands CEO Michael Ward.

Last week, Tidelands subsidiary Terranova Energia filed a permit application with Mexico's Comision Reguladora De Energia (CRE) for construction of its proposed 50 Bcf underground natural gas storage facility in the Brasil Field of the Burgos Basin near Reynosa, Tamaulipas (see Daily GPI, Aug. 9). The facility will be Mexico's first gas storage field and is expected to be part of Tidelands' integrated cross-border gas pipeline, storage and LNG import project.

Tidelands already has received authorization from the Texas Railroad Commission for its two 500 MMcf/d border crossing pipelines. It now is awaiting approval from the Federal Energy Regulatory Commission (see Daily GPI, May 27). The pipelines include the proposed Progresso International Pipeline system, which will run from the Rio Grande to Donna Station with potential interconnects with Texas Eastern Gas Transmission, Tennessee Gas Pipeline and Texas Gas Transmission. It will extend 17 miles into Mexico and 10 miles into the U.S. The other system, Mission International Pipeline, will run from the Rio Grande to the Valero Gilmore Plant with potential interconnects with Houston Pipe Line, Calpine, Kinder Morgan Texas, El Paso and Gulf Terra. The line will extend 52 miles into Mexico and 25 miles into the U.S.

A Tidelands subsidiary filed an application in March with the Comision Reguladora de Energia (CRE) in Mexico for a permit to build a 1 Bcf/d Terranova Oriente pipeline system, a 160-mile bidirectional pipeline that will form the backbone of the Tidelands project in Mexico and will connect to the two border crossing systems.

Initially, gas flows into the border crossing pipelines will be in a southerly direction into Mexico. But later, it is anticipated that gas flows will be reversed after Tideland's proposed Dorado HiLoad LNG import facility is connected to the new storage field (see Daily GPI, April 20, March 30, March 22). In the coming months the company intends to file applications for its LNG terminal and related facilities and for its proposed pipeline to Monterrey.

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