ESENTIA Energy Development SAB de CV, Mexico City, has agreed to acquire 100% of the equity interests of Energía Occidente de México S de RL de CV (EOM) from TC Energy Corp., Calgary, for a gross purchase price of $400 million.

EOM owns and operates the 313-km Guadalajara-Manzanillo natural gas pipeline system, which runs from the Guadalajara area in Jalisco to Manzanillo, Colima, and is directly interconnected with ESENTIA's Villa de Reyes-Aguascalientes-Guadalajara (VAG) pipeline system operated by Esentia Pipeline de Occidente S de RL de CV, an indirect subsidiary of ESENTIA. The pipeline transports up to 500 MMcfd of natural gas, connecting imported LNG supply near Manzanillo and continental gas supply near Guadalajara to power plants and industrial customers in Colima and Jalisco.

Upon closing, the acquisition will extend ESENTIA's pipeline network to the Port of Manzanillo on Mexico's Pacific coast, making the company the only private operator with an integrated natural gas pipeline system connecting the Permian basin in Texas to Mexico's Pacific coast, the company said in a release Sept. 21.

The deal is part of ESENTIA's strategy to build a cross-border transportation system and would "expand ESENTIA's ability to serve existing and prospective customers within the combined system's area of influence, including demand from power generation, industrial customers and potential LNG-related projects," said Daniel Bustos, chief executive officer.

ESENTIA also highlighted construction of its Aguascalientes Compression Station, which is expected to increase capacity on the VAG pipeline system beginning in early 2027. The project is part of the company's three-phase expansion plan, which includes a total estimated investment of $680 million and an increase of 660 MMcfd in natural gas transportation capacity.

For TC Energy, the transaction creates "optionality to redeploy proceeds from a mature asset towards high-value growth opportunities across our North American footprint," said François Poirier, president and chief executive officer, in its own release Sept. 21.

The transaction is expected to close in first-half 2027, subject to customary closing conditions, regulatory approvals, and consents. Following closing, TC Energy will continue to own and operate its broader Mexico natural gas pipeline network, including about 3,300 km of pipeline and 8.7 bcfd of installed natural gas transportation capacity.