U.S. natural gas exports to Mexico established a new monthly record in June 2023

posted by AJOT | Aug 04 2023 at 09:45 AM

U.S. natural gas pipeline exports to Mexico averaged a record 6.8 billion cubic feet per day (Bcf/d) during June 2023, which is 0.1 Bcf/d greater than the previous record set in June 2021, according to data from Wood Mackenzie. Natural gas exports to Mexico surpassed 7.0 Bcf/d on nine days in June driven by higher-than-normal temperatures.

The increase in Mexico’s natural gas imports from the United States was driven primarily by hot weather that increased demand for natural gas in Mexico’s electric power sector. U.S. natural gas pipeline exports to Mexico generally peak in the summer months due to high temperatures that increase the demand for electricity to power air conditioning.

U.S. natural gas pipeline exports to Mexico averaged 5.9 Bcf/d in the first half of 2023 (1H2023), less than 0.1 Bcf/d lower than the 1H2021 record-high average of 6.0 Bcf/d. After declining in 2022, U.S. natural gas pipeline exports to Mexico have returned to previous high levels reached in 2021, driven by a steady increase in Mexico’s electric power sector consumption, which has grown on average 3% every year since 2018, according to data from Wood Mackenzie.

In 2022, Mexico increased its domestic natural gas production by 14%, or 0.3 Bcf/d, contributing to a decline in natural gas pipeline imports from the United States. However, in 1H2023, Mexico’s domestic production remained flat compared with 2022, and pipeline imports from the United States increased 3%, or 0.2 Bcf/d.

U.S. natural gas pipeline exports to Mexico have grown in recent years as the domestic pipeline network within Mexico continues to expand:

In 2020, the Wahalajara system, a group of pipelines that connects the Waha hub in West Texas to Guadalajara and other population centers in west-central Mexico, was completed. The Villa de Reyes–Aguascalientes–Guadalajara pipeline system (0.9 Bcf/d capacity), which connects to several other pipelines in central Mexico, was placed in service. The Sierrita pipeline, which transports natural gas from Arizona to the Mexican border, was expanded by 0.3 Bcf/d.

In 2021, the expansion of the Mier-Monterrey pipeline (0.2 Bcf/d), which delivers natural gas from U.S. connecting pipeline NET Mexico in South Texas to the Monterrey Hub in Mexico’s northeast, was completed. The Samalayuca-Sásabe pipeline (0.5 Bcf/d capacity), which transports natural gas from the Permian Basin in West Texas and eastern New Mexico to northwestern Mexico, entered service.

In 2022, two more pipelines that deliver natural gas to Mexico’s capital city region went into partial service: the Tula–Villa de Reyes pipeline (0.9 Bcf/d) is expected to begin full service in 2023, and the Tuxpan–Tula pipeline (0.9 Bcf/d) is expected to begin full service in 2025.

In 2023, the Cuxtal Phase II pipeline—the second segment of the Energía Mayakan pipeline—is expected to enter service. The Energía Mayakan pipeline expands the natural gas pipeline network on the Yucatán Peninsula.