Mexico’s natural gas pipeline network is entering a crucial phase of expansion with the expected completion of the La Laguna-Aguascalientes and Villa de Reyes-Aguascalientes-Guadalajara pipelines later this year. These new pipelines will be linked together with the existing Roadrunner, Tarahumara and El Encino-La Laguna pipelines to form the second largest integrated natural gas transportation network in Mexico. This system will link central Mexico with the northwestern part of the country, which is already supplied by gas flowing in from the Waha Hub on the U.S. side of the border and provide additional demand markets for Permian Basin natural gas. Fermaca, a Mexico City-based company, is constructing the new route, and its marketing affiliate, Santa Fe Gas, is actively building a natural gas marketing business within Mexico. Today, we examine Fermaca’s natural gas marketing affiliate and its role in bringing new supply from the U.S. to Mexico’s natural gas market.
The NATGAS Appalachia weekly report provides the data and insights to monitor the northeast natural gas market’s twists and turns and identify the risks and opportunities along the way, including tracking supply-demand trends, outbound capacity and their impact on takeaway pipeline utilization, and regional prices.
We last looked at Mexico’s natural gas market in Welcome to the Future, a blog dedicated to evaluating the evolving structure of Mexico’s pipeline transportation capacity market and its implications for flows and pricing of gas within Mexico. That blog also detailed the efforts of Comisión Federal de Electricidad’s (CFE) marketing affiliate, CFEnergía. In addition, we recently looked at Mexico’s gas infrastructure in Rio, where we took a deep dive into the Nueces header being built for CFE at the Agua Dulce Hub in South Texas. And last summer, we blogged about the status of gas pipelines in Mexico as well as the header system that was built by Energy Transfer Partners for CFE at West Texas’s Waha Hub in Part 4 of our Waha blog series, “It Was Good Living With You, (W)aha.” Today, we look at both infrastructure and gas marketing within Mexico as we evaluate Fermaca’s gas marketing affiliate, Santa Fe Gas.
Santa Fe Gas, which was formed in 2016, is active in natural gas markets on both sides of the border but was founded primarily to capitalize on new demand markets that are opening as a result of Mexico’s energy reform and natural gas pipeline infrastructure buildout that began in 2013. Like other gas marketers in Mexico, Santa Fe can bid on capacity in open seasons held by El Centro Nacional de Control del Gas Natural (CENAGAS), which was formed by the Mexican government in 2014 to assume ownership and management of Petróleos Mexicanos’ (Pemex) legacy pipeline system, set its rates and oversee who has access to its transportation capacity. CFEnergía and Santa Fe both have capacity on the Fermaca system, and any excess capacity or future expansion in the system will be handled via an open season, according to Mexican law. Santa Fe can also manage capacity that is released to them by others. Although Santa Fe operates independently from its parent company, understanding Fermaca and its activities in Mexico is a key part of grasping the story of its gas marketing unit, as well as the ongoing development of Mexico’s gas pipeline infrastructure.
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About the song
"Closer" is a hit song by The Chainsmokers, the American electronic dance music DJ duo of Alex Pall and Andrew Taggart. The tune — written by Andrew Taggart, Ashley Frangipane, Halsey, Shaun Frank, Freddy Kennett, Isaac Slade, and Joe King — features vocals from Taggart and Halsey, and was recorded in the key of A flat major, with a tempo of 95 beats per minute. Taggart says the song was inspired by Blink 182’s "I Miss You." "Closer" was released in digital format in July 2016 and went to #1 on the Billboard Hot 100 Singles chart; it stayed there for 12 consecutive weeks. It was also #1 on Billboard’s Dance/Electronic Songs chart, and received a nomination for Best Pop Duo/Group Performance at the 2017 Grammy Awards.
The Chainsmokers were formed in New York City in 2012 after Taggart, who was working in an art gallery in Manhattan, was introduced to DJ Pall. They started working together, doing remixes of indie-band songs. The duo has cited Pharrell Williams and Deadmau5 as musical influences.
