The Mexico gas market continues to grow more comfortable using U.S. pricing to transact natural gas, according to the fourth survey of natural gas buyers and sellers in Mexico conducted by NGI’s Mexico GPI.
The survey, conducted in late February/early March, received 23 responses from buyers and sellers in Mexico.
According to respondents, 64% of gas bought and sold in Mexico is either done as a difference to a daily or monthly U.S. index, or is negotiated as a bidweek basis differential to the Henry Hub. That’s up significantly from the 40-47% range from the first three surveys held over the past two years.
If you include the First Hand Sales (VPM) mechanism, a formula used by state oil and gas firm Petróleos Mexicanos (Pemex) that is tied to U.S. indexes, the 64% figure...