Editor’s Note: NGI’s Mexico Gas Price Index, a leader tracking Mexico natural gas market reform, is offering the following column by Eduardo Prud’homme as part of a regular series on understanding this process.

sistrangas

The spring of 2017 promised a change in the natural gas industry in Mexico. An open season to allocate capacity on the Sistrangas national pipeline system, together with an auction of capacity in the main gas entry pipeline into the country, paved the way for private traders to offer supply proposals to Mexican consumers. At the time, Petróleos Mexicanos (Pemex) was barely able to meet half of national demand through its production. Energy regulator Comisión Reguladora de Energía (CRE) and Energy Ministry Sener knew that depending on Pemex as the only intermediary...