TransCanada and Infraestructura Energética Nova (IEnova), a subsidiary of Sempra Energy, have been awarded a contract to construct the $2.1bn Sur de Texas-Tuxpan natural gas pipeline in Mexico.
Under the contract, the two firms will build the 800-kilometre (497-mile) pipeline to enable natural gas transportation from South Texas, US to northeastern Mexico.
TransCanada will invest approximately $1.3bn in the project, which will begin offshore in the Gulf of Mexico, at the border point near Brownsville, Texas and end in Tuxpan, in the state of Veracruz.
With 2.6 billion cubic feet a day capacity, the project will be supported by 25-year natural gas transportation contract with the Mexico’s state-owned power company Comisión Federal de Electricidad (CFE).
TransCanada president and CEO Russ Girling said: "This new project brings our footprint of existing assets and projects in development in Mexico to more than $5bn, all underpinned by 25-year agreements with Mexico’s state power company."
The project will connect with Cenagas’ pipeline system in Altamira. It will also interconnect with TransCanada’s Tamazunchale and Tuxpan-Tula pipelines as well as with other transporters in the region.
TransCanada will operate the pipeline project with 60% stake. The remaining stake will be held by IEnova.
Scheduled to be commissioned in late 2018, the pipeline will also connect to the Nueces-Brownsville pipeline in Texas.
The $1.5bn Nueces-Brownsville pipeline project will be constructed by Valley Crossing, a unit of Spectra Energy as part of a contract awarded by CFE.
The project involves construction and operation of a header system of more than 5 billion cubic feet per day (Bcf/d) near the Agua Dulce Hub in Nueces County, Texas.
It will also include construction of a 2.6 Bcf/d pipeline originating at that header and extending to Brownsville, Texas.
Image: TransCanada head office in Calgary, Alberta. Photo: courtesy of Qyd/Wikipedia.