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NET Mexico Pipeline Officially Online Ahead of Schedule

NET Midstream affiliate NET Mexico Pipeline Partners LLC's (NET Mexico) 120-mile, 42- and 48-inch diameter Texas intrastate pipeline has entered service, delivering U.S. natural gas to Mexico ahead of its scheduled Dec. 1 target start date, the company said Monday.

"Our team successfully implemented our innovative project design and met every milestone and challenge," said NET Midstream Co-President Jerry Dearing.

The design capacity of NET Mexico is 2.3 Bcf/d, which can be expanded to 3.0 Bcf/d with additional compression. NET Mexico will initially operate with 50,000 HP of compression, ramping up to 114,000 HP in late 2015, the company said. The pipeline is anchored by a long-term firm gas transportation agreement, for up to 2.1 Bcf/d, with MexGas Supply Ltd., a subsidiary of Pemex, the Mexican state-owned gas company.

NET Mexico's Agua Dulce Hub will include more than 4 Bcf/d of receipt capacity from nine gas pipelines and four gas processing plants. The hub includes three large-diameter header lines, as well as bi-directional meters at many points, with 2.6 Bcf/d of capacity, affording shippers maximum supply liquidity and optionality. Additionally, the company is in discussions with several potential shippers to subscribe to a 700,000 MMBtu/d compression expansion of NET Mexico.

NET Mexico will offer intrastate service from Eagle Ford Midstream (also owned by NET), Enterprise Intrastate Pipeline, Enterprise Texas, Houston Pipe Line, Kinder Morgan Tejas, Conoco Lobo and Southcross. Service from Natural Gas Pipeline Company of America and Tennessee Gas Pipeline will be offered under FERC's NGPA Section 311, which will be added in the coming weeks. NET Mexico will also add receipt points from four processing plants in 2015: Exxon's King Ranch plant, DCP's LaGloria and Gulf Plains plants and Enterprise's Delmita plant.

The pipeline's border crossing was given Federal Energy Regulatory Commission authorization to begin service late last month (see Daily GPIOct. 30). That same week, Kinder Morgan Inc.'s (KM) Sierrita Pipeline was given the OK to enter service (see Daily GPIOct. 31).

Cross-border flows of natural gas from the United States to Mexico are growing as Mexico relies increasingly on gas-fired power generation (see Daily GPINov. 7).

In addition to NET Mexico, NET Midstream operates three pipelines in the Eagle Ford Shale serving producers and power generators. The Company also owns Monument Pipeline, which serves producers and end-users in the Houston area, and South Shore Pipeline, which provides natural gas service to the city of Corpus Christi, TX.

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