A U.S. subsidiary of Mexico’s state power company Comisión Federal de Electricidad (CFE) posted a 14% year/year increase in pipeline natural gas exports from the United States to Mexico during the second quarter, according to the U.S. Department of Energy.
The subsidiary, CFE International LLC (CFEi), exported 298,963 MMcf or 3.3 Bcf/d under short-term contracts during the period, up from 262,844 MMcf (2.89 Bcf/d) in 2Q2021, according to DOE’s latest North American natural gas trade report.
Amid stagnant production in Mexico, CFE sources gas from the United States in order to fuel the company’s growing fleet of gas-fired power plants. It also markets gas to third parties within Mexico.
[LatAm Energy Trends: From Mexico down to Argentina, from natural gas and LNG to crude oil and ESG, listen in as NGI’s Christopher Lenton and Rice University’s Francisco Monaldi discuss what to expect from the energy markets of Latin America in 2023. Tune into the Hub & Flow podcast now.]
CFEi was the No. 12 marketer by volume in NGI’s latest quarterly survey of North American marketers and traders.
Pemex Transformación Industrial, a subsidiary of state oil company Petróleos Mexicanos (Pemex) exported 60,829 MMcf or 668 MMcf/d from the United States during the period, down from 89,218 MMcf (980 MMcf/d) a year earlier, DOE data show.
Exports of U.S. natural gas to Mexico by pipeline and truck rose 8.8% sequentially but fell by 5.5% year/year in 2Q2022 to 542.7 Bcf or 5.96 Bcf/d, according to the report.
Mexico was the destination for 70.6% of U.S. pipeline exports, with the remaining 29.4% going to Canada.
Prices of U.S. pipeline and trucked exports to Mexico averaged $7.22/MMBtu for the quarter, up from $3.06 in 2Q2021.
The United States exported gas to Mexico via 19 exit points along the border during the second quarter. About 61% of exports transited from one of four Texas border cities: Rio Grande City and Brownsville in South Texas, and Presidio and San Elizario in West Texas.
Rio Grande City was the winner, accounting for 127.6 Bcf or 1.4 Bcf/d. Brownsville is the starting point of the 2.6 Bcf/d Sur de Texas-Tuxpan offshore pipeline.
Exports to Mexico via the Permian Basin in West Texas doubled from 0.6 Bcf/d in 2019 to 1.2 Bcf/d in 2021, driven by infrastructure coming online in Mexico, according to a recent note by the U.S. Energy Information Administration.
CFEi CEO Miguel Reyes said at the recent LDC US-Mexico Natural Gas Forum in San Antonio, TX, earlier this month that CFE is working with private sector firms to optimize excess pipeline capacity to shore up supply for the Mexican market.
Flagship projects include the 1.3 Bcf/d Southeast Gateway offshore pipeline planned with TC Energy Corp., as well as an offshore liquefied natural gas hub in partnership with New Fortress Energy Inc.
Also speaking at the LDC event was former CFEi CEO Guillermo Turrent. He said the partnerships are positive news, but cautioned that capacity expansions would be needed to accommodate all the new projects.
BP plc’s Pedro Elio, who heads up the Mexico gas marketing business, told the forum that Mexico’s industrial gas consumers are adopting more sophisticated gas buying strategies to capitalize on U.S. prices that remain relatively cheap compared to the global market.
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