Mexico Now Exports LNG Made From Texas Gas. That Makes It a Second Gate for US Supply, Not a New Producer

In August 2024, Mexico shipped its first cargo of liquefied natural gas. New Fortress Energy produced it aboard a floating liquefaction vessel off Altamira, in Tamaulipas, and sent it through the Panama Canal to Mexico's own import terminal in Baja California Sur. The unit can liquefy up to 0.199 billion cubic feet a day of gas. A second identical unit is under construction, and on the Pacific coast Sempra is building the 0.4 Bcf/d first phase of Energía Costa Azul at the site of an existing import terminal.

Fast LNG Altamira's units are fed by US gas delivered through the Sur de Texas-Tuxpan pipeline. Most of the world's large LNG buyers, including Japan, China and the European Union, do not have free trade agreements with the United States. A terminal on Mexico's Pacific coast, such as Energía Costa Azul, can ship to Asia without crossing the Panama Canal, cutting voyage times to Japan, South Korea and China substantially compared with US Gulf Coast terminals.

Floating liquefaction can be installed relatively quickly, close to existing pipeline infrastructure, without the long build of an onshore terminal. Developers have proposed several more west coast projects: Saguaro Energía LNG at 2.0 Bcf/d, Amigo LNG at 1.0 Bcf/d, Gato Negro at 0.6 Bcf/d, Salina Cruz at 0.4 Bcf/d and Vista Pacífico at 0.5 Bcf/d, for a combined 4.5 Bcf/d. The EIA expects North American LNG export capacity to more than double from 11.4 Bcf/d in 2023 to 24.4 Bcf/d in 2028, if projects under construction start on schedule.

Against those risks, the developers can point to strong demand from Asian buyers looking for diversified supply and shorter routes, and to the continuing growth of low-cost US gas production. Mexican LNG is best thought of as an additional gate for US gas into world markets. If the west coast projects are built, they will offer Asian buyers a faster route to North American gas.