TransCanada Teams Up to Build Mexican Fuels Terminal
August 02 2016 - 4:40PM
Dow Jones News
MEXICO CITY—TransCanada Corp. is joining forces with a Mexican
oil-industry startup and a logistics company to build an
$800-million fuel storage and transportation system in Mexico,
taking advantage of new energy laws and the opening of the retail
market there to further bolster its position in the country.
TransCanada, Sierra Oil & Gas and Grupo TMM will build a
marine terminal near Tuxpan, in Mexico's Gulf coast state of
Veracruz, to offload and distribute refined products such as
gasoline, diesel and jet fuel in central Mexico, the companies said
Tuesday.
The project includes a 165-mile pipeline running inland from the
terminal, and a storage and distribution hub in central Mexico.
TransCanada will own half of the project, Sierra 40% and Grupo TMM,
a transport and logistics company with operations at Tuxpan,
10%.
The development would be the largest single investment in
refined products since Mexico overhauled its energy laws, the
companies said.
Constitutional changes in 2013 opened oil and gas exploration
and production in Mexico to foreign and private companies for the
first time in more than seven decades. Changes also ended state oil
company Petró leos Mexicanos' monopoly on the production and
importation of gasoline, diesel and other fuels.
As of April, any company can import and sell gasoline in the
country as Mexico moves toward a competitive fuels market. New laws
also allow for the rebranding of service stations, which previously
were all Pemex franchises.
Mexico consumes more than 800,000 barrels a day of gasoline, and
more than half of that is imported.
TransCanada said the refined-products pipeline, with a capacity
of 100,000 barrels a day, will be parallel to the Tuxpan-to-Tula
natural-gas-pipeline project it was awarded last year.
The Canadian company also recently won a contract to build a
$2.1 billion underwater natural-gas pipeline from South Texas to
Tuxpan in partnership with Sempra Energy's Mexican unit,
Infraestructura Energé tica Nova SAB, and expects to be operating
eight natural-gas pipelines in Mexico at the end of 2018,
representing investment of about $5 billion.
Sierra Oil & Gas, formed in 2014, was the first private
Mexican company to be awarded exploration blocks under the energy
opening, winning two areas in the Gulf of Mexico last year in the
first of the three auctions held so far.
(END) Dow Jones Newswires
August 02, 2016 17:25 ET (21:25 GMT)
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