More natural gas heads to Yucatan from Mayakan Pipeline

Source:GE Energy

Mexico’s Yucatan Peninsula is poised to receive more natural gas for cleaner electric power generation from an extension of the Mayakan pipeline. Mexico’s Yucatan Peninsula is poised to receive more natural gas for cleaner electric power generation from an extension of the Mayakan pipeline that GDF SUEZ Mexico and GE Energy Financial Services announced today. Energía Mayakan, a subsidiary of GDF SUEZ Mexico and GE Energy Financial Services, is extending its 700-km-long, 24-to-16-inch-diameter Mayakan pipeline that starts in Macuspana, Tabasco, and runs through the states of Chiapas, Campeche and ends in Valladolid, Yucatan.

The extension will run 75 kilometers from the Nuevo Pemex Gas Processing Plant -- owned by Pemex Gas y Petroquímica Básica (PGPB) in Nuevo Pemex, Tabasco -- to connect with the existing Mayakan pipeline in Macuspana, Tabasco. Mexico’s electric utility CFE has contracted with PGPB to use 300 MMFCD (million cubic feet per day) of gas through this new 30-inch-diameter pipeline to switch power plants in the Yucatan Peninsula from burning diesel and fuel oil to cleaner and less expensive natural gas.

GDF SUEZ Mexico is investing about US$92 million for a 67.5 percent equity stake in the pipeline, while GE Energy Financial Services is supplying about US$44 million for a 32.5 percent stake. No debt financing is involved. Preparations for construction – to be carried out by Mexico’s Arendal – are under way, with completion of the pipeline extension slated for June 2014. GDF SUEZ and GE Energy Financial Services have been partners on the original Mayakan pipeline, which GDF SUEZ also operates, since 1999. The extension is being carried out under the existing natural gas transportation permit for Mayakan Energia, in accordance with Mexico’s regulations.

“This investment helps Mexico strengthen its natural gas infrastructure in the kind of critical, contracted, long-lived midstream assets we know well,” said Alex Urquhart, president and CEO of GE Energy Financial Services. “In addition, this transaction illustrates our commitment to improving the assets in our portfolio, investing in projects during their development, and repeating business with valued customers such as Pemex and co-investors such as GDF SUEZ.”

GDF SUEZ Mexico’s CEO, Germain Manchon, remarked, “We are pleased to start Mayakan’s extension, and to continue working side by side with the Energy Regulatory Commission, PEMEX, the Federal Electricity Commission, and a trusted partner in GE, to bring more gas and power to a growing region like the Yucatan Peninsula. For GDF SUEZ, this project is proof of our company’s commitment to increase our operations and investment in Mexico.”

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