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TransCanada Completes $360M Guadalajara Pipeline

Calgary-based TransCanada Corp. announced Monday it has completed its $360 million Guadalajara Pipeline for the Mexican government tied to its liquefied natural gas (LNG) and gas-fired electric generation expansion. It is the Canada energy company's second biggest investment in Mexico.

The entire capacity of the 192-mile, 30-inch-diameter pipeline is held under a 25-year contract with Mexico's state-owned electric company, Comision Federal de Electricidad (CFE). Two years ago TransCanada won the contract to build, own and operate the pipeline in Mexico to deliver regasified LNG from the then under-construction Manzanillo terminal (see Daily GPI, May 8, 2009).

The new pipeline is touted by TransCanada and Mexican officials as being a key infrastructure addition in allowing the increased development of gas-fired electric generation in the region, which includes Mexico's second largest city.

It has a capacity to transport 500 MMcf/d to a nearby CFE-owned power plant and 320 MMcf/d to the Pemex-owned national pipeline system near Guadalajara in the state of Jalisco, a TransCanada spokesperson said.

It is the fourth major pipeline project completed by TransCanada in the past 12 months. The others are two phases of an oil pipeline, Keystone Pipeline System Phases I & II; and the Groundbirch and Bison natural gas pipelines now in operation.

"The Guadalajara pipeline represents key infrastructure that will allow CFE to continue developing a natural gas-fired electricity generation fleet in the rapidly growing central region of Mexico," said TransCanada CEO Russ Girling.

TransCanada owns and operates the 81-mile Tamazunchale Pipeline in central Mexico. In the 1990s TransCanada built the Mayakan and El Bajio pipelines. Those pipelines, later sold, were the first non-Pemex pipelines in Mexico.

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