TransCanada Corp. Mexican subsidiary Transportadora de Gas Natural del Noroeste, was awarded the contract to build, own and operate the El Oro-to-Mazatlan Pipeline (Mazatlan Pipeline) in Mexico by Mexico’s Comision Federal de Electricidad (CFE).

Just last week CFE awarded Transportadora de Gas Natural del Noroeste the contract for the $1B El Encino-to-Topolobampo Pipeline (Topolobampo Pipeline) project (see Daily GPI, Nov. 2).

The latest contract award is for the Mazatlan Pipeline project, estimated by TransCanada to cost US$400 million.

The 257-mile pipeline would begin at El Oro and end in Mazatlan, in the state of Sinaloa. The 24-inch diameter pipeline would have contracted capacity of 202 MMcf/d with in-service planned for the fourth quarter of 2016. The pipeline would interconnect with the Topolobampo Pipeline. Construction of the two new pipelines is supported by 25-year gas transportation service contracts with the CFE, TransCanada said.

TransCanada built, owns and operates the Guadalajara and Tamazunchale gas pipelines in central Mexico and will soon break ground on a Tamazunchale Pipeline Extension.

Gas demand in Mexico is growing, and so are gas imports from the United States.

“Mexico has considerable natural gas resources, but its production pales in comparison to other North American countries and the development of its unconventional shale gas resources is proceeding slowly,” the Energy Information Administration (EIA) said in a new analysis of the country. “Mexico’s import needs are rising as production stagnates and demand increases, particularly in the electricity sector. Consequently, Mexico will rely on increased pipeline natural gas imports from the United States and liquefied natural gas (LNG) from other countries.”

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