Mexico buying more US natural gas

Fuel Fix:

U.S. natural gas exports to Mexico hit a new record amid sagging production south of the border.

Mexico imported about 6 billion cubic feet of natural per day from the United States in August, the U.S. Energy Information Administration reported late Thursday afternoon.

Some 5.1 billion cubic feet of natural gas per day was delivered via cross-border pipelines while another 860 million was delivered using liquefied natural gas import terminals, EIA data shows.

The record figures come at a time when natural gas production in Mexico continues to fall and demand from new power plants and factories is growing.

Mexico's dry natural gas production was 2.4 billion cubic feet per day in October, according to Mexico's state-owned oil company Petróleos Mexicanos, or Pemex. The figure marks a 7 percent decline from Oct. 2017 and a 21 percent drop from Oct. 2016.

EIA attributed Mexico's sagging natural gas production to declining reserves, a low commodity prices and limited exploration and production of new wells.
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The cartels are hurting Mexico's ability to extract natural gas and oil in the portion of the Eagle Ford formation that extends across the Rio Grande.  Mexico is also hurt by corruption that has made adding new pipelines not cost effective because of local attempts to require increased payments for the pipeline right of way.   That is likely the reason for the LNG imports.