• Natural Gas News

    Indigenous Groups Stalling Mexican Gas Pipeline Development


Indigenous groups opposed to Mexican pipeline projects that would bring more natural gas from the US have forced developers to slow construction.

by: Jim Bentein

Posted in:

Natural Gas & LNG News, Americas, Corporate, Investments, Political, Ministries, Contracts and tenders, Infrastructure, Pipelines, News By Country, Mexico

Indigenous Groups Stalling Mexican Gas Pipeline Development

Indigenous groups opposed to Mexican pipeline projects that would bring more natural gas from the US have forced developers to slow construction while they engage in protracted negotiations with the groups.

The delays, some for as long as two years, have been caused by injunctions and other legal measures that have virtually stalled five planned projects.

The delays are related to Mexico’s 2013-2014 energy reform, which ended the monopolies of the state-owned oil and gas company Petroleos Mexicanos (Pemex) and the Federal Electricity Commission (CFE) in an effort to attract private sector investment.

The investment has poured in – oil and gas majors have spent heavily to buy former Pemex-held onshore and offshore leases while utilities from Europe, the US and Canada have won contracts to build pipelines and power plants – but the reforms also made consultations with indigenous groups and other interested parties a part of the permitting process. That, in turn, has led to injunctions and other legal moves by those groups.

In mid-December, the association representing 67 companies and some $10bn in investment, condemned the use of the legal maneuvering and called on the federal government to do something to deal with the moves, which it called “barriers to the nation’s social and economic development”.

The Asociacion Mexicana de Gas Natural (Mexican Natural Gas Association) said the legal moves were stopping developments that would lead to “the creation of new jobs and the generation of electricity that is cleaner and more competitive”.

One of the projects that has been delayed is Sur de Texas-Tuxpan, a $2.1bn undersea pipeline that would move 2.6bn ft3/day of natural gas from south Texas to the Mexican port of Tuxpan, on the Gulf Coast. The project, which would ship gas to the Mexico’s booming petrochemical industry in the state of Tamaulipas and to other industrial users in the states of Tuxpan and Veracruz, was slated to be in operation by the end of this year.

However, members of a fishing co-operative and an indigenous group have taken legal action to stop construction in two different areas along the route.

Partners in the project are Calgary-based TransCanada and IEnova, the Mexican subsidiary of Houston-based Sempra Energy.

Juan Carlos Hernandez, TransCanada’s spokesman in Mexico City, told NGW work continues on the project, although he acknowledged the injunctions have affected construction.

“Regarding your questions on the Tuxpan-Tula pipeline, we are working with all involved parties in order to find a mutually beneficial solution,” he said in an email. “Construction continues in areas not impacted by a legal resolution.”

Elsewhere, members of an indigenous Yaqui tribe in December cut a 25-foot piece out of IEnova's Sonora pipeline, a 500 mile conduit put into service in 2017 to meet demand along Mexico's west coast. IEnova is awaiting a court ruling that would allow its workers onto the site to repair or re-route the pipeline.