Major Mexico natural gas pipeline starts operations

TC Energy and IEnova announced that the USD $2.6 billion Marino Sur pipeline will begin its operations after the renegotiation of the terms of natural gas pipeline contracts that are expected to save the Mexican government USD $4.5 billion

Major Mexico natural gas pipeline starts operations
English 18/09/2019 20:30 EFE y Reuters Mexico City Sharay Angulo & Angus MacSwan/REUTERS & EFE Actualizada 20:38

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A major natural gas pipeline between Texas and the Mexican Gulf Coast port of Tuxpan that was at the heart of a dispute between Mexico’s government and infrastructure firms begins operations on Tuesday, the companies behind it said.

Canada’s TC Energy and a Mexican unit of U.S. company Sempra Energy, IEnova, said in a statement the USD $2.6 billion Marino Sur pipeline was starting operations. The announcement was made three weeks after the government said it had renegotiated some terms of the contract to build it.

The Marino Sur pipeline starts operations a year late after the López Obrador administration decided to renegotiate the contract with the firms.

“With a capacity to transport 2.6 billion cubic feet of natural gas daily, the South of Texas pipeline will increase significantly the cheapest reliable supply of natural gas in Mexico,” announced the firms in a release.

The project had an estimated investment of USD $2.6 billion and created roughly 3,000 jobs.

The 772-kilometers-long pipeline runs in open ocean from the border with the U.S. near Brownsville, Texas, up to Altamira, in the northern Mexican state of Tamaulipas, and continues all the way to Tuxpan, Veracruz.

According to the energetic consortium, this pipeline will supply fuel to “several generation plants located in Altamira, Tuxpan, and the central region of Mexico.”

Last August 27, López Obrador announced his government had reached a deal with four companies that will allow Mexico to save USD $4.5 billion.

“Through this alliance with the CFE, we are contributing to Mexico to reach its objective of supplying energy in an emerging economy with the use of cheap, efficient, and environment-friendly natural gas,” said Robert Jones, president of TC Energy in Mexico.

Likewise, Tania Ortiz, CEO of Mexican IEnova, asserted that “this important project will guarantee the reliable and safe supply of cheap, efficient and environment-friendly fuel to promote economic development, the creation of jobs and the well-being of Mexicans.”

The energy companies explained that the construction of the pipeline was made “by the hand of regulators, landowners, and the state governments of Tamaulipas and Veracruz,” and through “cutting-edge technology designed to protect the environment.”