MEXICO CITY – TransCanada announced it won the contract to build, own and operate the Tuxpan-Tula Pipeline in Mexico. Construction is supported under a 25-year natural gas transportation service agreement with the Comision Federal de Electricidad (CFE), Mexico’s state owned power company.
The pipeline will originate in Tuxpan, in the state of Veracruz, and extend through the states of Puebla and Hidalgo, supplying natural gas to CFE combined-cycle power generating facilities in each of those jurisdictions, as well as to the central and western regions of Mexico.
The pipeline will serve new power generation facilities, as well as those currently operating with fuel oil, which will be converted to use natural gas as their base fuel. Construction is expected to start in 2016.
“The Tuxpan-Tula Pipeline demonstrates our continued commitment to developing Mexico’s energy infrastructure to meet the need for increased natural gas supply,” said Russ Girling, TransCanada’s president and CEO.
TransCanada expects to invest $500 million in the 36-inch pipeline and anticipates an in-service date in the fourth quarter of 2017. The pipeline will be about 155 miles long and have contracted capacity of 886 MMcfd.
The Tuxpan Tula Pipeline will complement TransCanada’s business in Mexico. TransCanada also owns and operates the Tamazunchale and Guadalajara pipeline systems and is completing construction of the Topolobampo and Mazatlan pipelines.
By 2018, with the Tuxpan-Tula Pipeline, TransCanada will have five major pipeline systems, with about $3 billion invested in Mexico, according to TransCanada.