Shell wins permits for Mexico LNG plant on Pacific Coast

Debra Beachy

Petroleum News contributing writer

Royal Dutch/Shell Group has been awarded two permits by Mexico's state energy and environmental regulators to build a liquefied natural gas terminal on Mexico's Pacific coast, the company said in a press release. However, Shell still needs to get a land use permit for the project. Shell also has said it wants to build an LNG plant at Altamira on Mexico’s Gulf Coast.

The proposed west coast terminal, to be located in Costa Azul, some 12 miles north of the city of Ensenada , will have a capacity of 7.5 million tons a year and will start operations in 2007.

The Energy Regulatory Commission (Comision Regulatora de Energia), or CRE, granted a permit, and so did the government environmental agency, Shell said in the release. Shell said it is considering several sources in the Asia-Pacific basin to supply the terminal.

The re-gasified LNG would be transported through a new gas pipeline to link up with the existing gas infrastructure in the north of Baja California. Gas would be marketed to power plants, industrial customers and major utilities in the northwest of Mexico and southern California, Shell said.

Sempra Energy and Marathon Oil also have proposed LNG terminals in Baja California.