The first test, or “cool-down” shipment of liquefied natural gas (LNG) to the Manzanillo receiving facility is expected this Friday along the southwest coast of Mexico. An initial shipment of 77,000 tons of LNG is slated to come from Peru, which has a long-term contract with the Mexican federal government through Spain-based energy giant Repsol.

Since late last year the opening of a 1 Bcf/d LNG receiving terminal developed by a Korean-Japanese consortium has been delayed by a variety of setbacks, including some dredging issues and the rerouting of a railroad track near the facility on the southern Pacific Coast south of Mexico’s second largest city, Guadalajara (see Daily GPI, Dec. 6, 2011).

After a seven-month delay, Friday’s shipment will mark the start of a 20-year deal Repsol has to bring LNG from Peru to Mexico’s state electricity commission (CFE, for Comision Federal de Electricidad). The terminal was built and will be operated by a three-party consortium of Mitsui & Co. Ltd. (37.5%), Samsung Engineering & Construction (37.5%) and Korea Gas Corp. (25%).

Sources in Mexico quoted a CFE spokesperson as estimating two shipments a month will come to the Manzanillo facility initially. The plant is scheduled to be formally opened March 28. Conflicting speculation has been offered about why the LNG docking, storage and regasification facility, which completed construction last September, has been delayed in opening. Some of the blame has been placed on “poor planning” by CFE.

Three years ago the trio secured a 20-year deal with CFE to build the $900 million project. Repsol refers to the overall deal as its Camisea project from Peru, targeting it exclusively for Mexico’s second LNG facility.

San Diego-based Sempra Energy has its Energia Costa Azul LNG terminal in North Baja California in Mexico, along with numerous transmission and distribution pipeline operations. TransCanada Corp. has numerous pipelines or proposed pipeline projects south of the U.S. border.

Last year TransCanada completed building a $320 million pipeline in Mexico that will deliver regasified LNG from the Manzanillo terminal (see Daily GPI, June 21, 2011). The entire capacity of the 190-mile, 30-inch-diameter pipeline is held under a 25-year contract with CFE. Two years ago TransCanada won the contract to build, own and operate the pipeline (see Daily GPI, May 8, 2009).

The proposed Guadalajara Pipeline follows a route from Manzanillo on Mexico’s Pacific Coast to Guadalajara with the capability of transporting 500 MMcf/d on a short segment from the LNG plant to a CFE-run power plant; the rest of the pipeline will have a 320 MMcf/d capacity to Guadalajara, according to TransCanada.

©Copyright 2012Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.