Reforms

Mexico has emerged as an important and growing market for U.S. natural gas producers, and for U.S. midstream companies scrambling to develop gas pipelines to serve Mexico’s gas consumers. Meanwhile, U.S. gasoline, diesel and liquefied petroleum gas (LPG) exports to Mexico are also up. Petróleos Mexicanos (Pemex)—the state-owned hydrocarbon giant, now in the midst of a major reboot—is on the hunt for private-sector partners to help revive Mexico’s sagging oil and gas production, and U.S. oil producers and Pemex are planning their first swaps of crude. Today we highlight RBN Energy’s latest Drill Down report examining the changing yins and yangs of cross-border energy relations.

Growing Mexican demand for natural gas has been seen as a timely boon to Texas gas producers, which have been losing their Northeast and Midwest markets to the Marcellus and Utica. Gas exports to Mexico still are rising sharply, and several new gas pipelines are planned to move Eagle Ford, Permian and other US gas to Mexico. But the Mexican government is reforming its energy sector, a move that some hope will result in more aggressive development of domestic gas reserves. What does that mean for US gas exports to Mexico? Today we explore the changing lay of the land south of the border.