Mexico’s energy sector has been dealing with a fair amount of uncertainty of late. Newly installed Mexican President Andrés Manuel López Obrador has promised to undo elements of the country’s historic energy reform program, limit imports of hydrocarbons, and focus on domestic production and refining. How much will all this affect the export of natural gas from the U.S. to Mexico? It’s too soon to know what the long-term impact might be, but for now, gas exports remain near record highs and the pipeline buildout within Mexico is proceeding. That’s not to say, however, that the infrastructure work has gone without its own set of challenges — many of those were apparent well before the recent political changes. Today, we begin a series examining the opportunities and potential pitfalls ahead this year for Mexico’s natural gas pipeline infrastructure additions.
Mexico’s decisions earlier in this decade to shift away from oil-fired power generation, develop a fleet of new gas-fired power plants and build a network of new, large-diameter gas pipelines to fuel them have had a profound effect on U.S. producers. Given that Mexico’s production of natural gas has been declining for some time now — and that gas production has been rising fast in the Permian, the Eagle Ford and other shale plays on the U.S. side of the border — it seemed natural that Mexico’s power sector would turn to the U.S. for an increasing share of its gas needs. We’ve blogged about this a number of times, most recently in Breakthru back in July 2018, when we discussed Mexico’s imports of U.S. natural gas by pipeline topping 5 Bcf/d for the first time. (Mexico also imports LNG from its northern neighbor.) In addition, we’ve been tracking the buildout of new gas pipelines on both sides of the border. For example, in No Surprises we detailed the impact of the El Encino-Topolobampo pipeline; in our Closer blog, we took a deep dive into the most recent developments in Northwest Mexico, focusing on Fermaca-built pipelines. It’s clearly time for another update because 2019 has the potential to be a big year for Mexico’s gas pipelines.
We’ll begin this new blog series by focusing on the pipelines entering Mexico from far West Texas (black-dashed circle in Figure 1). Later in this series, we will move further into Mexico to discuss other changes under way on the gas grid. However, before we dive into the details, we do want to give a brief update on the gas pipeline buildout in Mexico.
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About the song
"Before the Deluge," written by Jackson Browne, appears as the final cut on Browne's third studio album, Late for the Sky. The LP, released in September 1974, was produced by Jackson Browne and Al Schmitt. It was recorded at Elektra Sound, Hollywood Sound, and Sunset Sound Recorders in Los Angeles. Late for the Sky went to #14 on the U.S. Billboard Top 200 Albums chart and is certified Platinum by the Recording Industry Association of America. Personnel on the album were: Jackson Browne (lead vocals, acoustic guitar, piano and slide guitar), David Lindley (electric guitar, lap steel and fiddle), Doug Hayward (bass), Jai Winding (piano and organ), and Larry Zack (drums). Background harmony singers included Don Henley, Terry Reid, Dan Fogelberg, and J.D. Souther.
Jackson Browne is an American singer-songwriter and musician. He has released 14 studio albums to date. Browne has won six Grammy Awards, and was inducted into the Rock and Roll Hall of Fame in 2004 and the Songwriters Hall of Fame in 2007. He still records to this date and will be embarking on an acoustic concert tour in March of this year.
Comments
It does not say anyting about Trans Pecos
In reply to Trans Pecos by Madison Dayton
We will cover Trans-Pecos next in the series, as that pipeline moves gas from the US-Mexico border into the El Encino hub.