Mexico's CFE lets contract to TransCanada for gas pipeline

Mexico’s federal power company Comision Federal de Electricidad (CFE) awarded TransCanada Corp. Mexican subsidiary Transportadora de Gas Natural del Noroeste the contract to build, own, and operate the El Encino-to-Topolobampo Pipeline. The 30-in. OD pipeline will extend 329 miles from El Encino, in Chihuahua state, to Topolobampo in Sinaloa, at a contracted capacity of 670 MMcfd.

TransCanada described the project as part of Mexico’s continuing efforts to expand its electrical grid and generating capacity. The pipeline will interconnect with other pipelines expected to be built as a result of separate CFE bid processes.

TransCanada said it expects there will be additional opportunities to participate in the build-out of Mexico’s natural gas pipeline system and that these opportunities would be consistent with its strategy to build long-life infrastructure underpinned by long-term contracts. TransCanada has already built and is operating the Guadalajara and Tamazunchale pipelines and will soon break ground on a Tamazunchale Pipeline Extension (OGJ Online, Feb. 24, 2012).

TransCanada expects to invest $1 billion in the Topolobampo line, supported by a 25-year natural gas transportation service contract with CFE. The company anticipates the pipeline will enter service in third-quarter 2016.

Contact Christopher E. Smith at chriss@ogjonline.com.

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