The recent completion of a natural gas pipeline in central Mexico is expected to boost exports from Permian Basin. The southern most segment of the Wahalajara system (Villa de Reyes-Aguascalintes-Guadalajara pipeline) began operations in June connecting new markets in Mexico to U.S. sources. The Wahalajara system, which receives 0.89 billion cubic feet per day, is a group of new pipelines that connects the Waha hub in west Texas to Guadalajara and other population centers in west central Mexico. The system provides U.S. natural gas to meet growing demand from Mexico’s electric power and industrial sectors.
U.S. Energy Information Administration said Monday it “expects utilization of the Wahalajara system to quickly ramp up, resulting in increased U.S. natural gas exports to Mexico out of western Texas and additional takeaway capacity out of the Permian Basin.” U.S. natural gas exports to Mexico reached a record 5.5 Bcfd in October 2019. Additional export volumes will be limited by how quickly customers in Mexico can be connected to the pipeline system and by the economic impact of coronavirus pandemic.