Sempra Gears Up for First Mexico LNG Production

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Written by Eric Funderburk for IIR News Intelligence (Sugar Land, Texas)

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Summary

Sempra Energy has been receiving feed gas at its Energía Costa Azul LNG plant in Baja California, Mexico, since late April and expects to see first LNG production in June.

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Milestones Achieved

Years in the making, Sempra Energy's Energía Costa Azul (ECA) liquefied natural gas (LNG) export facility is gearing up to begin production. The plant, located on Baja California's Pacific Coast in Mexico, began receiving feed gas April 20. Sempra said it expects initial LNG production to begin in June. The plant will export LNG produced from natural gas sourced from the Permian Basin of Texas and New Mexico.

Industrial Info Resources has been reporting on the project for more than 10 years. Construction kicked off in earnest in 2021, and finishing touches are expected to be completed this summer, after initial LNG production begins. Industrial Info Resources data show the $2 billion plant's single train will produce 3.25 million tons per annum (MTPA) at full capacity. Subscribers to the Industrial Info Resources Global Market Intelligence (GMI) Project Database can learn more by viewing the project report. Like LNG Canada's plant in Kitimat, British Columbia, the ECA facility's Pacific Coast location provides easier access to Asian markets, compared with other North American LNG plants on the Gulf Coast and Atlantic seaboards.

Export Extension

In March, the U.S. Department of Energy (DOE) announced that it was extending its window for the plant to begin exports by six months, so ECA has until late September to ship its first cargo, but with LNG production set to begin next month, ramping up as the days go by, the plant is beginning to be up and running, marking the close of engineering, procurement and construction (EPC) contractor Technip Energies' years of construction work.

Despite the plant's Mexico location, export authorizations come under the DOE as the plant is exporting U.S. gas.

Another Mexico Project Cancelled

In a February filing with the U.S. Securities and Exchange Commission, Sempra disclosed that it had cancelled another LNG project under consideration on Mexico's Pacific Coast: the Vista Pacifico LNG project. The plant was to have been located at the port of Topolobampo, Sinaloa, on the west coast of mainland Mexico and would have produced up to 4 MTPA of LNG. The cancellation came despite export authorization from the DOE as well as a purchase agreement with TotalEnergies, one of the key buyers of LNG produced at the Baja site, signing on for 1.7 MTPA from the near-finished plant, along with Japan's Mitsui, which will take 800,000 tons per year from the ECA facility.

Close on the Heels of Another Startup

Sempra's announcement comes only a few weeks after Exxon Mobil Corporation and QatarEnergy announced that the first cargo had shipped from their joint venture Golden Pass LNG plant in Texas. The U.S. Energy Information Administration (EIA) reported that the initial cargo came only 23 days after initial LNG production began in late March, suggesting Sempra's ECA cargos may begin shipping sooner rather than later.

Sempra's Port Arthur LNG Project

In Port Arthur, Texas, Sempra and contractor Bechtel, which also performs LNG construction duties for Cheniere Energy, are deep in the throes of construction of two 6.5-MTPA LNG production trains. Both are expected to begin operating in 2027, then ramp up to their combined 13 MTPA. In the meantime, Sempra expects to have started work on a third 6.5-MTPA train within the coming months, and in 2027 is expected to commence work on fourth train at the Port Arthur facility. Industrial Info Resources data suggests a total project investment value in the neighborhood of $26 billion.

Key Takeaways

Sempra Energy expects initial LNG production from its Energía Costa Azul in Baja California to begin in June.
• The announcement comes a few weeks after Golden Pass LNG announced the first LNG shipment from its plant in Texas.
• Sempra also is at work on the Port Arthur LNG project, the first two trains of which are expected to be completed next year.

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).