Mexico Wants More Texas Natural Gas

by Jennifer Hiller

The export of U.S. natural gas is climbing — and much of it is coming from Texas shale fields and bound for power plants in Mexico.

As Mexico continues to overhaul and modernize its energy sector, its appetite for U.S. natural gas is swelling. Daily pipeline exports to Mexico rose 25 percent in August, compared with the year before, according to the U.S. Energy Information Administration. August exports were up 85 percent from the average amount of natural gas that had been exported daily between 2011 and 2015.

It’s a trend that shows no signs of slowing, even as Mexico moves to increase its own oil and gas production, according to Antonio Garza Jr., a former U.S. Ambassador to Mexico under President George W. Bush and a former chairman of the state’s oil and gas regulator, the Texas Railroad Commission.

“The amount of natural gas flowing from shale fields in the United States to Mexico has been rapidly increasingly over the last few years — doubling from mid-2014 through today and expected to double yet again in the coming years,” Garza said.

More than half of U.S. natural gas exports have gone to Mexico since April 2015. To move the gas, pipeline capacity from the U.S. to Mexico is on the rise, too. It’s currently at 7.3 billion cubic feet per day, mostly headed from Texas to the northeast and central parts of Mexico.

Four new U.S.-to-Mexico pipelines are expected to come on line next year, with two more expected to start moving gas in 2018. In the next three years, that U.S.-to-Mexico export capacity is projected to double, according to recent reports from the EIA.

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