Mexican gas imports on the rise

Mexico’s push for self sufficiency in natural gas shapes up as a long-term uphill struggle, based on the latest trends issued by state-owned Pemex.

Having switched in the late 1990s from viewing gas as almost an unwanted byproduct of oil production to utilizing the resource for state-operated electricity generation, Mexico has posted steady gains in production.

But it wasn’t until 2006 when output reached 5.35 billion cubic feet per day that 1999 volumes were finally surpassed. Production in 2007 is expected to edge past 6 bcf per day and inch forward over the next decade to 6.9 bcf per day.

But Pemex’s gas outlook for the 2007-16 period says that by 2016 another 2 bcf per day (75 percent of it as LNG) will have to be imported to meet domestic needs.

For now, imports are on the decline from 750 million cubic feet per day in 2003 and 2004 to 415 million in 2006 and 391 million for the first 11 months of 2007. The outlook is based on Mexico’s proven reserves of 14 trillion cubic feet, enough to sustain production at current levels for less than nine years, but there is hope in the revival of exploration in long-established basins of non-associated onshore production, while offshore finds of non-associated gas have made some headway in recent years.

—Gary Park