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FERC OKs Startup of U.S.-Mexico Norte Crossing Pipeline
El Paso Natural Gas Co. LLC (EPNG) was given permission by FERC to place into service its Norte Crossing facilities at the U.S.-Mexico border in El Paso County, TX.
The Federal Energy Regulatory Commission (FERC) last year approved Kinder Morgan’s EPNG’s request for a presidential permit to build Norte Crossing (see Daily GPI, Sept. 4, 2012). Kinder Morgan spokesman Richard Wheatley said Monday the company expected to place the pipeline in service by the end of the month.
El Paso’s Norte Crossing 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.
“Increased development of the natural gas infrastructure in the relevant area of northern Mexico, combined with a growing preference for gas-fired electric generation, has resulted in a shipper request for increased gas delivery to the international boundary,” EPNG said in its application at FERC. “To meet near-future growth expectations, the Mexican Comision Federal de Electricidad is proposing to build five new power plants over the next 15 years to serve new power generation loads in the states of Chihuahua, Durango and Coahuila in northern Mexico.”
Mexico is importing increasing amounts of natural gas from the United States as efforts to develop its own resources are largely focused on oil and demand for gas increases, particularly from power generators. Imports set a record last year, according to the Energy Information Administration (EIA). Gas exports to Mexico grew by 24% last year to 1.69 Bcf/d. Imports now account for more than 30% of Mexico’s gas supply, and the country’s gas usage is at its highest level ever, EIA said (see Daily GPI, March 14).
Exports of natural gas from the United States to Mexico have doubled in the past three years and are likely to continue to grow for at least the next few years, according to an analysis by Barclays Capital (see Daily GPI, May 21). According to Goldman Sachs, “…assuming all the pipeline projects start on schedule, we expect U.S. exports to Mexico to grow by 0.4 Bcf/d year over year in 2013 and 0.6 Bcf/d year over year in 2014, compared to a growth rate of 0.3 Bcf/d year over year in 2012” (see Daily GPI, Feb. 11).
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