Shell contracts LNG for planned western Mexico terminal

April 8, 2002
Royal Dutch/Shell unit Shell Gas & Power has secured initial supplies for its proposed LNG regasification terminal in Costa Azul, in the municipality of Ensenada, Baja California, on Mexico's West Coast. Shell did not identify the sources of the initial supply of 7.5 million tonnes/year for the project, other than to say they were in the Asia-Pacific region.

By the OGJ editors

HOUSTON, Apr. 8 -- Royal Dutch/Shell unit Shell Gas & Power has secured initial supplies for its proposed LNG regasification terminal in Costa Azul, in the municipality of Ensenada, Baja California, on Mexico's West Coast. Shell did not identify the sources of the initial supply of 7.5 million tonnes/year for the project, other than to say they were in the Asia-Pacific region.

The terminal, which will have a send-out capacity of as much as 1.3 bcfd, is scheduled to come on stream in 2006. Investment costs are estimated at $500 million.

Shell will market the gas to power plants and other potential customers in Baja California and will sell surplus gas to markets in Southern California.

Shell Gas & Power Director Jon Chadwick, said: "The development is significant in that it furnishes a supply of LNG to the new terminal, providing Mexico a new supply of gas to meet the growing energy demands of Northwest Mexico, whilst providing an outlet to market the surplus gas to the United States."

Shell will be holding comprehensive consultations with local communities and relevant authorities on the environmental and social impact of the planned development.