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Mexico must capitalize on its access to cheap and abundant natural gas north of the border, and on its own regulatory framework for developing the entire gas value chain, according to Acclaim Energy Solutions’ David Madero Suárez, who directs the firm’s energy consulting practice.

In a speech to the Mexican senate last week, Madero said Mexico has a “very powerful” set of tools at its disposal to capture the economic and environmental benefits of natural gas over other fossil fuels. He served previously as the head of Mexico’s Centro Nacional de Control del Gas Natural (Cenagas), which operates the Sistrangas national pipeline network.

“We have today a favorable legal framework for the exploration, production, processing, transport, storage, distribution and marketing of natural gas,” Madero said, referring to the market-opening constitutional energy reform of 2013. The legislative overhaul allowed the creation of “institutions that eliminated conflicts of interest,” and which mandate transparent contracts between the government and upstream oil and gas operators, Madero said.

The new rules also “professionalize” the natural gas transport segment, allowing for both firm and interruptible supply contracts, and for capacity open seasons regulated by the Comisión Reguladora de Energía.

Thanks to the reform, users can unbundle the purchase of natural gas molecules and transport capacity, meaning that firms today have “all the possibilities, all the tools to truly administer in the best manner possible, their spending on energy in the case of natural gas,” Madero said.

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