18 July 2023
President Andrés Manuel López Obrador met with Mexico Pacific executives at the location of the company’s $14bn Saguaro Energía liquefied natural gas (“LNG”) export project in Puerto Libertad, Sonora on July 15 to discuss the project’s progress.
The Saguaro Energía LNG export project is a 3 train, 15 million tonne per year LNG export project, supported by a natural gas pipeline that will cross Texas, Chihuahua and Sonora (the “Project”).
The Project is strategically located on the West Coast of Sonora, close to abundant, low-cost natural gas from the nearby Permian Basin with a liquefaction point significantly closer proximity to Asia, the engine room of global LNG demand. Coupling low cost U.S. gas and a 60% shorter shipping distance to Asia, free of Panama Canal congestion risk, enables Mexico Pacific to reliably deliver the lowest landed price of LNG into Asia from all of North America.
“Mexico Pacific will position Mexico as the fourth largest LNG exporting country and a key contributor in meeting critical energy security needs”, commented Mexico Pacific CEO Ivan Van der Walt. “We will make an investment of $14bn in Mexico, the largest foreign direct investment into Mexico to date, creating over 13,000 direct and 21,000 indirect jobs, without using Mexican natural resources. This is a project that benefits so many and we are grateful for the President’s continued support.”
While there, President Andrés Manuel López Obrador also witnessed the consolidation of the strategic alliance between Mexico Pacific and the Federal Electricity Commission (“CFE”) for the construction of the project.
Under the 20-year agreement, CFE will supply Mexico Pacific with natural gas delivered from the Permian Basin into Mexico Pacific’s pipeline in the U.S. and via CFE’s pipelines in Mexico. The agreement creates significant long-term alignment between the Parties resulting in multi-billion dollar revenues for CFE and diversified gas deliveries for Mexico Pacific.
“Mexico Pacific welcomes CFE as a long-term strategic partner. CFE has built a reputation as a large scale, highly reliable portfolio gas supplier with unparalleled experience in gas pipeline execution and supply in Mexico. With key permits and agreements in place, including the LNG export permit, CFE brings tremendous value to the Project as we move into construction and operations.” said Ivan Van der Walt, Chief Executive Officer of Mexico Pacific. “We are proud that our project will bring generational value to the region through significant employment opportunities and associated social and economic improvements during construction. We look forward to realizing those benefits for the people of Mexico.”
President Lopez Obrador subsequently voiced his continued support for the project and shared a video on the strategic alliance between Mexico Pacific and CFE and the greater benefits for Mexico.
About Mexico Pacific
Mexico Pacific’s anchor project, the 15 mtpa Saguaro Energia LNG Facility, is the most advanced LNG development project on the West Coast of North America. The Saguaro Energia LNG Facility achieves significant cost and logistical advantages resulting in the lowest landed price of North American LNG into Asia by, leveraging low-cost natural gas sourced from the nearby Permian Basin, and a significantly shorter shipping route avoiding Panama Canal transit risk for Asian markets. More information can be found at http://www.mexicopacific.com.