TransCanada has been chosen to build, own and operate the Tula-Villa de Reyes pipeline in Mexico. Construction is supported by a 25-year natural gas transportation service contract for 886 MMcf/d with the Comisión Federal de Electricidad (CFE), Mexico’s state-owned power company.
TransCanada expects to invest $550 million in the 36-inch, 261-mile pipeline and anticipates an in-service date of early 2018. The pipeline will begin in Tula in the state of Hidalgo, and end in Villa de Reyes, in the state of San Luis Potosí, transporting natural gas to power generation facilities in the Central region of the country. The project will interconnect with TransCanada’s Tamazunchale and Tuxpan-Tula pipelines, as well as with other transporters in the region.
“The Tula – Villa de Reyes Pipeline complements our existing pipeline network in Mexico and furthers our strategy of owning and operating highly contracted and regulated assets that generate stable and predictable earnings and cash flow streams,” said Russ Girling, TransCanada’s president and CEO.
TransCanada was awarded the pipeline in November 2015. By 2018, TransCanada plans to operate six major natural gas pipeline systems in Mexico, representing an overall investment of $3.6 billion.