NET Midstream closes project financing for NET Mexico Pipeline

NET Midstream

NET Midstream reports that its affiliate, NET Mexico Pipeline Partners LLC, has closed a $665 million project financing with a syndicate of lenders, led by the Mitsubishi UFJ Financial Group (MUFG). The project financing was approximately 2x oversubscribed and received commitments from 100% of invited financial participants.

MUFG is joined by seven joint lead arrangers, including ING Capital, Credit Agricole, Natixis, Royal Bank of Canada, Nord/LB, BBVA, and Santander.

NET Mexico will build a 120-mile, 42-in.-diameter and 48-in.-diameter natural gas pipeline system to the international boundary, with approximately 120,000 horsepower of compression. NET Mexico will interconnect on the Mexican side of the border with Phase 1 of the Los Ramones Pipeline, which is being developed by an affiliate of Gasoductos de Chihuahua S. de R.L. de C.V. The pipeline will transport gas from nine interconnects at the Agua Dulce Hub in Nueces County, Texas, to a point near Rio Grande City, Texas, in Starr County and is scheduled to be placed into service in December 2014.

The pipeline is anchored by a long term firm gas transportation agreement, for up to 2.1 Bcf/d, with MGI Supply Ltd., an indirect wholly owned subsidiary of Pemex Gas y Petroquimica Basica (PEMEX Gas), the Mexican state-owned gas company.

In addition to NET Mexico, the company operates three pipelines in the Eagle Ford Shale serving producers and power generators. It also owns Monument Pipeline, which serves producers and end-users in the Houston area, and South Shore Pipeline, which provides natural gas service to the Corpus Christi, Texas, area.

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