The renegotiation by Mexico’s state power utility Comisión Federal de Electricidad (CFE) of five firm natural gas capacity contracts will cost CFE an extra $6.84 billion over the duration of the contracts, according to a new report by congressional audit office Auditoría Superior de la Federación (ASF).

Rio Grande prices

This assessment contradicts declarations by President Andrés Manuel López Obrador and CFE General Director Manuel Bartlett Díaz that amending the contracts would save CFE billions.

López Obrador said in August 2019 that renegotiated contracts with developers Infraestructura Energética Nova (IEnova), TC Energy Corp. and Grupo Carso would save CFE $4.5 billion.

The following month, CFE announced an agreement with Mexican developer Fermaca that the utility said would...