NuStar-PMI venture to move US LPG, products to Mexico

NuStar Energy LP and PMI, an affiliate of Petroleos Mexicanos (Pemex), signed a letter of intent for a proposed joint venture to develop LPG and refined products pipeline systems from the US into northern Mexico. Under the JV, the companies will jointly fund construction of pipeline and storage assets, with NuStar managing construction and operation. LPG and refined products will move from Mont Belvieu and Corpus Christi, Tex., to Nuevo Laredo and Burgos-Reynosa, Mexico.

PMI noted that while it had previously partnered with NuStar to ship propane into Mexico, the new agreement is the first JV between the companies. NuStar will integrate the pipeline and terminal assets, supported by a throughput commitment from PMI, with its pipelines. The pipeline also will reduce the volume of products shipped south via truck.

NuStar expects to place the projects into service in second-half 2016.