Saguaro Energía LNG I and II are located in Puerto Libertad in Sonora, Mexico. The total project—to be developed in two phases—will offer Permian gas producers a relief valve for associated gas. (Source: Shutterstock/ Mexico Pacific)
Mexico Pacific Ltd. is working with financial advisers as it eyes a 2025 final investment decision (FID) on the anchor phase of the 30-million tonnes per annum (mtpa) Saguaro Energía LNG project on Mexico’s Pacific Coast.
The company is working with MUFG, Santander and JP Morgan to arrange the financing needed—likely a $15 billion investment—to support FID and the anchor phase of the liquefaction project, Patrick Hughes, Mexico Pacific senior vice president of government & external affairs, told Hart Energy.
“Each of them has significant experience and involvement in every major energy infrastructure project financing across North America in recent years,” Hughes said in an Oct. 23 email.
Quantum Capital Group is the controlling owner and lead sponsor of Mexico Pacific.
Saguaro Energía LNG I and II are located in Puerto Libertad in Sonora, Mexico. The total project—to be developed in two phases—will offer Permian gas producers a relief valve for associated gas and connect the U.S.’ cheapest gas to Asia, which will remain a key demand center for decades, Mexico Pacific said.
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Saguaro Energía I will include three 5-mtpa trains (15 mtpa of combined capacity). Saguaro Energía II would also include three 5-mtpa trains for another 15 mtpa of combined capacity.
Saguaro Energía I will source gas from Waha to be shipped along the 253-km Saguaro Connector pipeline on the U.S. side of the border. The Permian gas will then be shipped along the 802-km Sierra Madre pipeline on the Mexican side of the border.
Both segments of the LNG project will have the capacity to handle 2.8 Bcf/d of gas.
Houston-based Mexico Pacific has offtake agreements with Exxon Mobil Corp., ConocoPhillips, Shell Plc and Woodside Energy.
Additionally, Mexico Pacific made similar agreements with Asian players such as Posco International, Zhejiang Energy and GuangZhou Gas Group Co. Ltd.
All the agreements are indexed to the Waha and/or Henry Hub and include combined liquefaction and pipeline fees ranging from $2.50/MMBtu to $3.77/MMBtu, according to Poten & Partners.
Export terminals on Mexico's Pacific Coast would allow Permian LNG to reach new (or maybe Asian) markets, but certain headwinds keep developers from capitalizing on the Mexican Pacific Coast's access to international markets, according to Poten & Partners U.S. LNG Analyst Sergio Chapa.
Some include regulatory hurdles, a high-skilled labor shortage, limited natural gas pipeline capacity and in some cases, disinformation on social media, Chapa said.
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