POSCO to offtake Mexico Pacific’s LNG

Mexico Pacific , owner and developer of the Saguaro Energía LNG facility and the associated Sierra Madre Pipeline, has signed an LNG sales and purchase agreement (SPA) with POSCO International Corp , South Korea’s largest energy trading company.

Under the SPA, POSCO will purchase 0.7 mill tonnes per annum of LNG on a free-on-board (FOB) basis for 20 years.?

Mexico Pacific and POSCO are also evaluating additional opportunities to expand upon this initial commercial partnership, the companies said.?

South Korea has a robust trade relationship with Mexico and is one of the only major economies in Asia that has a comprehensive free trade agreement (FTA) with the US.

When coming online, the first phase of Mexico Pacific’s Saguaro Energía LNG facility located in Puerto Libertad, Sonora, Mexico, will comprise three liquefaction trains and associated infrastructure.?

The LNG facility will leverage abundant, low-cost natural gas from the Permian Basin in Texas, providing the lowest landed price of LNG into Asia globally, satisfying the world’s growing energy needs and positioning Mexico as the world’s fourth largest exporter of LNG, the company claimed.

“We are delighted to welcome POSCO International as a foundation customer, further validating the strategic value of west coast North American LNG for Korea, one of the world’s largest LNG importing markets,” said Sungbok PARK , Mexico Pacific’s Chief Marketing Officer.?

“We look forward to a lasting fruitful partnership with POSCO International and to delivering world-class infrastructure that strengthens global energy security, reduces emissions, and improves the lives of millions of people around the world,” he said.

With three liquefaction trains commercially contracted, strong support from governments and capital markets, and key federal, state, and municipal permits in place across the Saguaro Energía LNG facility and the Sierra Madre Pipeline, Mexico Pacific said it is? aiming for a positive final investment decision (FID).?

Together, these developments comprise the largest private investment in Mexico and a foundational pillar of the Sonora Plan that promotes clean energy development, investment, and economic prosperity for the region.

Mexico Pacific’s anchor project, the 15 mill tonnes per annum Saguaro Energía LNG facility, is claimed to be the most advanced LNG development project on the West Coast of North America.?

The plant will achieve significant cost and logistical advantages resulting in the lowest landed price of North American LNG into Asia by leveraging low-cost natural gas sourced from the nearby Permian Basin and a significantly shorter shipping route, which avoids the Panama Canal.?