Mexico's natural gas imports to soar by 133%
Eric Watkins
OGJ Oil Diplomacy Editor
LOS ANGELES, Jan. 6 -- Mexico's demand for natural gas will continue to outstrip the country’s production, with imports to cover the country's requirements set to increase by 133% during 2009-24, according to government figures.
Mexico’s El Financero newspaper, citing figures supplied by the Secretaría de Energia (Sener), said the country’s imports of gas will grow to 3.02 bcfd from the current 1.293 bcfd.
According to the report entitled Outlook of the Natural Gas Market, Mexico’s gas production grew 4.2% over the last decade, while the demand growth stood at 5.9%, representing a 1.7% shortfall to be filled by imports.
El Financero said this trend will be maintained until 2024, when the country's production will reach 8.668 bcfd, equivalent to an average growth rate of 2.3%/year. But it said that “demand will surpass 11 bcfd, which implies an annual growth rate of 2.8%.”
The Sener report said Mexico’s demand growth has been met partly with increasing gas imports, first from the US and then from other countries, with the establishment of LNG terminals in Altamira and Ensenada, in 2006 and 2008, respectively. It said the imports represented 3.7% of national demand in 1998, but 18.6% in 2008.
The Sener report explains increased demand for gas as coming from the launch of combined cycle plants to generate electricity, the moderate substitution of fuel oil in the electric and industrial sectors, greater requirements for the oil industry, and to a lesser degree, the use of natural gas that distributors have achieved in the residential and services sector.
The report states gas production will come from various fields both on and offshore.
It said production in Burgos is fundamental and will peak at 1.58 bcfd. However, its production will begin to decline in 2015, “registering volumes below 1 bcfd toward 2024.”
The report also estimates the Chicontepec field will have an incremental development in gas production and will reach its maximum in 2023-24 when it will average 611 MMcfd, and its contribution to national gas production will surpass that of Burgos starting in 2020.
Regarding deepwater projects, the report said production of gas will begin with the Lakach project in 2013, with initial production of 23 MMcfd.
Two years later, the Gulf of Mexico B and Gulf of Mexico South projects will add 51 MMcfd to a total production of 450 MMcfd of gas coming from deep waters, while the Area Perdido project will contribute 14 MMcfd in 2016.
These projects will continue their incremental development of gas production, during the outlook period, reaching a maximum of 1.305 bcfd in 2024.
The report acknowledges deepwater production is important, but “given the environmental conditions where these projects are carried out, it is considered that only 50% of this production is usable and the other half is normally reinjected as a recommended operational practice.”
Contact Eric Watkins at [email protected].