FERC Thursday approved Kinder Morgan Texas Pipeline LLC’s (KMTP) application to amend its presidential permit to increase the design capacity of its U.S.-Mexico border-crossing facilities from 425 MMcf/d to 700 MMcf/d (see Daily GPI, March 8).

The increase in the capability to move natural gas through the existing border-crossing facilities will be accomplished by system modifications to nonjurisdictional facilities upstream of KMTP’s border-crossing facilities, which were made to accommodate the changing flows on KMTP’s system and increased production from the Eagle Ford Shale in Texas. KMTP proposes no construction or modifications to its previously approved border-crossing facilities [CP13-94].

“The proposed amendment to increase the authorized capacity of the border-crossing facilities from approximately 425 to 700 MMcf/d will align Kinder Morgan Texas’s existing authorization’s with the projected capabilities of its intrastate system. Accordingly, the [Federal Energy Regulatory Commission] finds that approve of Kinder Morgan Texas’s proposal is consistent with the public interest,” the order said.

The facilities interconnect with KMTP’s intrastate pipeline in Texas and extend 878 feet to the border at the midpoint of the Rio Grande and then connect with affiliate Kinder Morgan Gas Natural de Mexico, S. de R.L. de C.V., which transports gas from the border to the Monterey area [CP13-94].

The current shipper customer of Kinder Morgan Mexico is Mexico’s Pemex-Gas Y Petroquimica Basica (Pemex), which buys gas at the U.S.-Mexico border from its affiliate, MGI Supply Ltd., to serve customers in the Monterrey area and to support its system throughout northeastern Mexico. In the United States, MGI Supply either purchases gas from KMTP at the border or ships gas to the border on KMTP’s intrastate system.

This latest application comes just after FERC authorized Kinder Morgan’s El Paso Natural Gas Co. LLC (EPNG) to place in service its Norte Crossing facilities at the U.S.-Mexico border in El Paso County, TX. The facilities (1,500 feet of 36-inch diameter pipe) run underneath the Rio Grande to deliver up to 366 MMcf/d of gas to a new delivery interconnect with the Tarahumara Pipeline at the border, which in turn is to deliver the gas to new generation plants to be constructed in northern Mexico.It is expected to go into service by the end of the month (see Daily GPI, June 18).

KMTP’s expansion of its cross-border capacity comes at a time when pipeline gas exports to Mexico are expected to increase as supply in the U.S. booms, thanks to shale plays and as Mexico concentrates its energy development efforts mostly on oil.

According to the Energy Information Administration (EIA), Mexico’s use of natural gas is rising faster than the country’s domestic production, “leading to both record pipeline gas imports from the United States and growth in the country’s imports of liquefied natural gas (LNG). Natural gas trade between Mexico and the United States has been growing; daily net exports from the United States to Mexico so far in 2013 (January 1-May 6) are estimated to average 1.6 Bcf/d, up almost 29% over the same period in 2012,” EIA said recently.

Kinder Morgan Inc. and other pipeline companies have multiple projects planned to serve gas demand in Mexico. In February, Kinder Morgan unit Sierrita Gas Pipeline LLC applied at FERC for authorization to build a pipeline (formerly known as the Sasabe Pipeline project) to serve the power generation market in northern Mexico (see Daily GPI, Feb. 26).

The Sierrita Pipeline project calls for the construction of a 59-mile, 36-inch diameter lateral from El Paso Natural Gas’s system in Arizona to a point south of Tucson near the international border at Sasabe, AZ. El Paso is owned by Kinder Morgan (see Daily GPI, Nov. 16, 2012). The project has an estimated capital cost of $204 million, and will have the capacity to deliver 200 MMcf/d of gas.

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