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Mexico Pacific LNG: A New Export Era Anchored by Permian Gas
10/16/2023![Mexico-Pacific-LNG-A-New-Export-Era-Anchored-by-Permian-Gas](https://images2.rextag.com/public/blog/BLOG_Mexico Pacific LNG A New Export Era Anchored by Permian Gas.jpg)
Natural gas from the U.S. Permian Basin is set to be the primary source for Mexico's Pacific's Saguaro Energía LNG facility.
Located in Puerto Libertad, Sonora, the Saguaro Energía LNG export facility will feature three processing trains. The site is primed for potential expansion with plans for three additional trains of similar capacity. Its strategic Pacific Coast location offers a 55% shorter shipping route to Asia, providing significant savings and reduced carbon emissions.
- The facility will have three trains, each having a processing capacity of 5 million tonnes per annum (mtpa). Combined, they offer a nameplate capacity of 15 mtpa, equivalent to 2 Bcf/d.
- Plans are in place to add three more trains, each with a capacity of 5 mtpa.
- The facility will utilize low-cost gas from the Permian Basin, specifically from the Waha hub.
- Gas will be transported via a 253 km pipeline in the U.S. that connects to an 802 km pipeline in Mexico. Both pipelines can handle up to 2.8 Bcf/d of gas.
“The facility will connect the cheapest natural gas from the Permian Basin's Waha hub to the world's largest demand center, Asia,” Kruse said during a panel discussion at Hart Energy’s Energy Capital Conference.
Economic Implications
Tyler Kruse, Vice President of Corporate Finance at Mexico Pacific Ltd., emphasized the advantages of sourcing cheaper natural gas from the Permian Basin's Waha hub. Stifel Financial Corporation projects an 8% LNG growth by the decade's end, underscoring the project's potential.
The Mexican government is in favor of the development of the LNG infrastructure. While concerns about drug cartels have been addressed, they are not deemed a major threat.
Investment & Partnerships
A final investment decision on the Saguaro Energía LNG facility is forthcoming, with operations anticipated to commence by 2027. Major energy players, including Shell, Exxon Mobil, and ConocoPhillips, support the facility. Contracted clientele includes Guangzhou Gas and Zhejiang Energy from China.
About Mexico Pacific LNG Terminal:
Mexico Pacific's Saguaro Energía LNG facility aims to bridge the supply-demand gap in the global LNG market. Located strategically, it ensures efficient transportation, tapping into the vast reserves of the Permian Basin. Their commitment to sustainability is evident with the reduced carbon footprint they offer compared to their Gulf Coast counterparts. The involvement of energy giants like Shell and Exxon Mobil further underscores the facility's significance in reshaping the global energy landscape.
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Exxon Mobil and Pioneer Merge in $60 Billion Deal to Dominate Shale Market
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/197Blog_Pioneer Assets Spotlighted as Exxon Acquires for $60 Billion.png)
Exxon Mobil (XOM.N) has reached an agreement to acquire its domestic competitor, Pioneer Natural Resources (PXD.N). This all-stock transaction, which places a valuation of $59.5 billion on the deal, promises to establish Exxon as the preeminent producer in the U.S.'s most extensive oilfield. At a valuation of $253 per share, this merger brings together the prowess of Exxon, America's largest oil entity, with Pioneer, a standout performer that has risen to prominence during the shale boom.
Bakken's Tipping Point: Grayson Mill's Potential Fall After Chevron-Hess
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/R-230(1)Blog_Grayson Mill acquired Ovintiv's Bakken assets for $825M in 2024.png)
The Permian Basin, a big oil area, is not seeing as many deals as before because lots of companies have already joined together. Now, experts think these companies might start looking for new places to invest in the U.S. One area getting attention is the Bakken play. Chevron Corp. has just made a big step there by buying Hess Corp. for $60 billion. Another company, Grayson Mill Energy, which got some help from a Houston investment firm EnCap Investments LP, might also be up for sale soon, worth about $5 billion.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/297_Blog_Keystone XL Pipeline Controversy and Wildlife Disaster From Trump's Green Light to Biden's Red Light on the 15 Billion Project.jpg)
The pipeline industry in the USA faced and still faces a range of regulatory challenges, including permitting delays, environmental requirements, and public opposition to pipeline projects. In recent years, pipeline projects like the Keystone XL and Dakota Access pipelines had legal and regulatory obstacles that delayed or canceled their construction. Keystone XL Pipeline, proposed by TransCanada in 2008, aimed to transport crude oil from Canada (around Calgary and Edmonton) to refineries on the Gulf Coast (Port Arthur). The project faced opposition from environmental groups and indigenous communities, who argued that it would contribute to climate change and pose a risk to water resources. In 2015, President Obama rejected the project, citing concerns about its environmental impact. However, in 2017, President Trump revived the project, leading to further legal challenges. In June 2021, U.S. President Joe Biden officially canceled the project on his first day in office.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/282_Blog_Renewable Natural Gas How RNG Changes the Industry.jpg)
The renewable natural gas (RNG) industry in the United States is showing promising signs of growth. As of 2019, the U.S. consumed 261 billion cubic feet (BCF) of RNG, primarily utilized by independent power producers, electric utilities, and various commercial and industrial entities. However, this figure represents only a small fraction of its potential. Research indicates that the U.S. could theoretically produce up to 2,200 BCF of RNG through anaerobic digestion alone, which would equate to about 11% of daily national natural gas consumption.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/295_Blog_Renewable Efforts Lag as Global Oil and Gas Demand Continues to Rise.jpg)
Recently, the progress toward an energy transition is hitting a snag. Sales of electric vehicles are decelerating, and the growth in wind and solar power needs to be keeping pace with expectations. To make matters more challenging, electricity prices are climbing when they were expected to fall. Amidst these setbacks, the oil and gas sectors are proving resilient. According to BP's latest energy outlook, not only are these energy mainstays here to stay, but their demand is expected to remain relatively high even after reaching a peak. Interestingly, BP forecasts that oil demand will reach its zenith next year, marking a critical moment in energy consumption trends. This isn't the first time BP has projected a peak in oil demand. Back in 2019, their review anticipated a decline in demand growth, but the prediction fell flat. Instead, oil demand surged to unprecedented levels following the end of the global pandemic lockdowns, defying previous forecasts and underscoring the enduring dominance of traditional energy sources in the global market.