TransCanada wins $500 million Mexico project

(Daniel Acker/Bloomberg)
(Daniel Acker/Bloomberg)

HOUSTON — TransCanada announced Wednesday it had won a contract to build, own and operate a natural gas pipeline serving Mexico’s state-owned power company.

The 155-mile line, called the Tuxpan-Tula Pipeline, will be TransCanada’s fifth in Mexico when it’s completed near the end of 2017. It’s also the Calgary, Alberta-based company’s latest push into the business of moving natural gas around Mexico, as the country looks to build out its network of energy infrastructure by luring private companies from abroad.

TransCanada said it plans to spend $500 million building the 36-inch, 155-mile pipeline that will run from near the Mexican Gulf Coast to the interior Mexican state of Hidalgo.

The company said the pipeline will bring about 866 million cubic feet per day of Texas natural gas to power generators in Mexico along its route. Construction is expected to begin in 2016.

TransCanada, best known for the recently rejected Keystone XL, is one of the largest pipeline companies in North America. The Calgary, Alberta-based company owns several crude oil pipelines in the U.S. and Canada, and has moved into Mexico as the country has allowed more private investment in its energy sector.

TransCanada already owns and operates the two pipeline systems in Mexico and is building two additional lines. When the Tuxpan-Tula Pipeline is completed, TransCanada said it will have made a $3 billion investment in the country and operate five major systems.