Port authority to award LNG permit Feb.17
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Mexico, Feb 09, 2004 (BNamericas.com via COMTEX) -- Mexico's Lazaro Cardenas port authority API will award on February 17 a land-use permit for the site of a proposed US$500mn liquefied natural gas (LNG) regasification project, API marketing manager Jaime Gonzalez told BNamericas.
Belgium's Tractebel or Spain's Repsol YPF are the only two companies that have bid on the project in Michoacan state on the Pacific coast.
API will open technical and economic bids on Tuesday (Feb.10), he said. Bids were received on January 30.
The port authority will then sign the 30-year permit on February 27 and it will take effect a year to the day later, Gonzalez said. Construction could then start immediately and take about three years with the plant starting up in 2008-2009.
The companies prefer the Lazaro Cardenas location over the alternative Manzanillo location because it is a larger port and is more oriented towards industry rather than container shipments, he said.
In addition, the winning bidder could use state oil company Pemex's existing gas pipeline connecting Lazaro Cardenas to central Mexico.
The terminal will receive approximately one LNG shipment of 135,000 cubic meters of gas a week, or 48 shipments a year for a total of 6.48 million cubic meters annually, Gonzalez said. Pemex will buy 100% of the gas produced by the plant.
Tractebel has signed a preliminary agreement to buy 2.7 million metric tonnes of LNG a year from Peru's Camisea natural gas project.
Most of the gas will be destined for residential and industrial consumption in the central part of the country, he said. The large steel industry in particualr will benefit from the gas supply.
State power company CFE could use part of the gas to supply a new generation project in the area, Gonzalez said. More information will be available after the contract is awarded.
"I think it's a possibility, but we're not sure," he said. It would take 4-5 years to build a power plant and the terminal will start operations before then.
The power sector's demand for natural gas will increase to about a third of the country's total gas supply in the next few years, he said. "The domestic natural gas production can't supply the power sector's needs, which is why we need to import it."
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