New Fortress Energy moves forward with Mexican LNG projects
11.14.2022 By - NEWS

November 14, 2022 [bnamericas] – US-based New Fortress Energy’s plan to build a Mexican offshore LNG export hub off the coast of Altamira, in Tamaulipas state, is expected to see its permitting process completed in early 2023.


In its Q3 results conference call, NFE said it had signed a definitive agreement to build up to three floating liquified natural gas (FLNG) barges in partnership with federal power utility CFE, for which it had the “vocal support” of the country’s permitting agencies and President Andrés Manuel López Obrador.

With each barge having a 1.4Mt/y processing capacity, the project could reach a total capacity of 4.2Mt/y.

NFE believes the project will create synergies with CFE’s needs by allowing it to increase the utilization of the 2.6Bf3/d (billion cubic feet per day) Sur de Texas-Tuxpan marine pipeline, and allowing it to sell some of the LNG output on the international markets.

“We understand there are active discussions to expand that capacity to a little bit above 3Bf3/d,” said managing director Andrew Dete. “The public filings indicate that historical use of the pipeline is around 20%. What we are really doing here is solving a problem CFE has, which is help them with some of the costs of the firm transportation, and also being a partner with them as we market the LNG globally.”

The first FLNG unit is already being built and expected to be finished in March, the company said. The permitting process is also expected to be wrapped up by early next year, with the project potentially starting operations around mid-2023.

“In the FLNG business, there are two things that matter: one is building the unit, and the other is having a place to put it,” said CEO Wes Edens. “We feel great about our situation in Mexico and we feel this is the first of many different opportunities we have down there.”

The company is also planning to create a second FLNG hub in partnership with national oil company Pemex. There, instead of using available Texan gas, it will liquefy Pemex’s planned deepwater production at the Lakach field off the coast of Veracruz state.

Pemex’s plans for the field, which stopped its activities in 2016 and did not reach commercial production after years of investment, involve investing US$1.16bn to complete six wells in the area with the goal of starting production next year. The company expects output to reach some 1.8Bf3/d at its peak.

“The development we are working on with Pemex will be the first time we buy gas directly from a productive well offshore. We think the implications for that long term are extraordinary,” Edens said.

As offshore LNG barges can be located close to production sites, they can put “truly stranded” gas into value, he added.

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