TORONTO (miningweekly.com) – Canadian oil and gas infrastructure operator TransCanada has been awarded a $500-million contract to build, own and operate the Tuxpan–Tula pipeline, in Mexico.
Construction of the 36-inch-diameter pipeline was supported by a 25-year natural gas transportation service contract with the Comisión Federal de Electricidad (CFE), Mexico's State-owned power company.
"The Tuxpan–Tula pipeline demonstrates our continued commitment to developing Mexico's energy infrastructure to meet the need for increased natural gas supply," TransCanada president and CEO Russ Girling stated.
Construction was expected to start in 2016 and TransCanada expected the pipeline to be in service by the fourth quarter of 2017.
The pipeline would be about 250 km long and have a contracted capacity of 886-million cubic feet a day.
The pipeline will start in Tuxpan, in the state of Veracruz, and extend through the states of Puebla and Hidalgo, supplying natural gas to CFE's combined-cycle power generating facilities in each of those jurisdictions, as well as to the central and western regions of Mexico.
The pipeline would serve new power generation facilities, as well as those currently operating with fuel oil, which would be converted to use natural gas as their base fuel.
The Tuxpan–Tula pipeline would complement TransCanada's business in Mexico, where it already owned and operated the Tamazunchale and Guadalajara pipeline systems and was completing construction of the Topolobampo and Mazatlan pipelines. By 2018, with the Tuxpan–Tula pipeline, TransCanada would have five major pipeline systems, with about $3-billion invested in Mexico.