Mexico’s National Center for Natural Gas Control (Centro National de Control del Gas Natural – CENAGAS) has authorized the country’s first open season for capacity rights on the national natural gas grid.
CENAGAS manages Mexico’s Integrated National Natural Gas Transportation and Storage System (Sistema de Transporte y Almacenamiento Nacional Integrado de Gas Natural—SISTRANGAS). SISTRANGAS has a pipeline length of 6256 miles (10,068 km) with a total transportation capacity of 6.3 Bcfd (178 X 106 m3/d).
The open season is part of Mexico’s ongoing energy reforms, which called for CENAGAS to take ownership of the pipeline assets of Petroleus Mexico (PEMEX), the country’s national energy company. Under the reforms, CENAGAS, created in 2014, will reimburse the former energy monopoly for its pipeline assets and transition the energy sector into an open market. The country hopes this will attract new funds from foreign and local companies, create competition among them and promote economic development.
To create the open market structure, CENAGAS held two open seasons for the 6.3 Bcfd (178 X 106 m3/d). available. The first came in October 2016, with Mexico’s Federal Electricity Commission receiving 1.1 Bcfd (31.1 X 106 m3/d), PEMEX 1.4 Bcfd (39.6 X 106 m3/d) and the country’s independent power producers 1.6 Bcfd (45.3 X 106 m3/d).
CENAGAS held Round 1 auctions on May 8, with 24 local and international companies requesting 3.6 Bcfd. CENAGAS only made 2.2 Bcfd (62.3 X 106 m3/d) available, with PEMEX taking 59% of that amount. ENGIE Mexico and ArcelorMittal obtained the next largest shares at 7% each. Shell Trading Mexico received 6%, Groupo Alphas acquired 5%, and the last 338 MMcfd (9.5 X 106 m3/d) went to 19 other natural gas-related companies.
These companies have until mid-June to sign one-year capacity contracts with CENAGAS. The contacts expire on June 30, 2018.