NET Midstream announced that NET Mexico Pipeline LP, a wholly owned subsidiary of NET, will build a 124-mile, 42" diameter natural gas pipeline system to the Texas/Mexico border, with associated compression. NET Mexico will be anchored by a long term firm gas transportation agreement, for up to 2.1 Bcf/d, with MGI Supply Ltd., an indirect wholly owned subsidiary of Pemex Gas y Petroquimica Basica, the Mexican state-owned gas company.
NET Mexico will transport gas from the Agua Dulce Hub in Nueces County, Texas to a point near Rio Grande City, Texas in Starr County. The pipeline will be placed into service in December 2014.
"NET Mexico Pipeline will be an important source of supply to meet Mexico's growing demand for natural gas" said Joe Gutierrez, Co-president of NET. "We look forward to this exciting new partnership with MGI and PEMEX Gas. NET Mexico is a natural next step in our pipeline system, as we connect abundant gas supply from the Eagle Ford shale to expanding power generation and industrial markets in Mexico."
In addition to NET Mexico, the company operates three pipeline systems in the Eagle Ford shale. Eagle Ford Midstream is a 150-mile, predominantly 30" intrastate natural gas pipeline that provides gas transmission for the Brasada Processing Plant in LaSalle County (operated by Western Gas Partners), and transports pipeline-quality gas from producers in the Eagle Ford shale to the Agua Dulce Hub. LaSalle Pipeline is a 52-mile, 16" pipeline which provides the full gas supply requirements for a 200 MW power generation facility located in Pearsall, Texas. South Shore Pipeline is a 30-mile pipeline that serves the City of Corpus Christi under a long-term gas supply and transportation contract.
The major driver of these operational cost reductions isthe use of large multi-well pads and zipper-fracs wherever possible, says company exec.
The Calgary-based company said in a press release that it grew production to an average 6,975 BOE/d in December 2013 from 1,600 BOE/d in August 2012.