Shell, El Paso Plan Liquid Gas Terminals in Mexico
Shell Oil Co. and El Paso Corp. announced plans to jointly develop Mexico’s first liquid natural gas terminal, a $300-million project aimed at fueling a new generation of power plants already under construction to meet Mexico’s growing electricity needs.
The LNG plant will be built on Mexico’s Gulf Coast in the city of Altamira in Tamaulipas state and could be operational in early 2004. The developers have not received a permit from the Mexican government to start construction, but government officials have given the project their preliminary endorsement.
The facility will take liquefied natural gas brought by ship to the Mexican coast and change it back into gas. There are surplus supplies of natural gas in South America, Asia and the Caribbean, and spokesman Aaron Woods said the company is negotiating with several sources. The company insists that it is the Mexican market, not the U.S., that is its prime target.
El Paso said earlier this year that it will spend $1.5 billion on liquid natural gas projects in coming years to address North America’s shortage, which has contributed to California’s ongoing electricity crisis. Its first project will be the restart of a mothballed LNG plant in Elba Island, Ga., later this year.
El Paso and Shell are two of several companies interested in building an LNG plant in Baja California to supply gas to energy-starved California.
