Natural Gas Infrastructure in Mexico Mexican energy sector were opened for private participation, including transportation, storage and distribution of natural gas. Since then, Mexico has received significant investments from transnational companies that provide natural gas midstream services. This has been most evident in two areas. First, in gas distribution, where the Energy Regulatory Commission (Comisión Reguladora de Energía, "CRE"), the federal regulatory agency, has granted more than 20 permits covering several geographic areas throughout the country. Second, in storage and regasification of liquefied natural gas, which takes place at the import terminals of Altamira on the Gulf coast, and Ensenada and Manzanillo, both located on the Pacific coast. Also, some Mexican distribution companies have operated in several cities in northern Mexico, and others have taken advantage of the niche market created by the self-supply scheme. domestic investments have been made in the transportation of natural gas, Petróleos Mexicanos ("Pemex"), through its subsidiary organism, Pemex Gas y Petroquímica Básica ("PGPB"), has continued to be an extremely dominant player. Until last year, PGPB was still the owner of approximately 90% of all natural gas transportation infrastructure, including the National Pipeline System (Sistema Nacional de Gasoductos, "SNG") and the Naco-Hermosillo system. This scenario was deplorable, given that PGPB was the sole supplier of natural gas of domestic origin, without the law requiring the creation of "Chinese walls" for unbundling transportation and commercialization activities, without real capacity reservation in place, and with a widespread "at the door" gas delivery scheme for large consumers. For years, the CRE attempted to implement the so- called "permanent regime" of first-hand sales of natural gas, which implied the capacity reservation in the transportation system, but it was never able to effective regulatory tools, and a lack of political will by successive government administrations then in power. The absence of adequate incentives for the construction of infrastructure, especially in the northern and western parts of the country, and the supply shortages from the southeast, gave rise to the "critical alerts" of 2011 and 2012, operative imbalances that made clear that the "timid" opening model had reached its limit. Attention to this crisis forced the federal government to promote the importation of liquefied natural gas utilizing the available capacity of the Manzanillo terminal. The regulatory impact of such was reflected in the increase of the SNG rates and, ultimately, in higher costs for end users. Since the end of 2011, it became clear that there was an urgent need to construct a huge gas pipeline that would connect the enormous production of natural gas in south Texas with the increasing demand in northern Mexico Cavazos & Newton from its office in Austin, Texas. Previously, he worked for many years in the Mexican government. From 2009 to 2012, he served as General Counsel of the Mexican Energy Regulatory Commission, leading the implementation of Mexico's 2008 energy reform in the gas and the renewable energy sectors. Torre Metrocorp, Avenida Tecamachalco No. 14-502 Colonia Lomas de Chapultepec Mexico City, Mexico C.P. 11010 ccn-law.com |