Spectra, TransCanada to build $3.6B natural gas pipeline into Mexico

FILE - In this May 9, 2015, file photo, workers unload pipes for the proposed Dakota Access oil pipeline that would stretch from the Bakken oil fields in North Dakota to Illinois. Dallas-based Energy Transfer Partners, the company proposing the pipeline, says it has secured all of the permissions from landowners it needs in the Dakotas. (AP Photo/Nati Harnik, File)
(AP Photo/Nati Harnik, File)

Houston-based Spectra Energy, TransCanada and others were awarded $3.6 billion in contracts Monday to build 665 miles of pipelines to carry natural gas from near Corpus Christi to the Mexican port city of Tuxpan, Veracruz.

The projects will feed cheap shale gas from Texas to Mexico to help meet the country’s growing electric generation needs. Mexico is building more gas-fired power plants.

The Mexican government awarded Spectra the contract to build a $1.5 billion pipeline from Nueces County to the Mexican border at Brownsville. TransCanada is leading the project to build the connecting, $2.1 billion Sur de Texas pipeline from the border through the Gulf of Mexico and into Tuxpan.

The Sur de Texas pipeline will be a joint venture between TransCanada and a Mexican subsidiary of San Diego-based Sempra Energy.

The Texas portion of the project, expected to come online in 2018, will go through Spectra’s Valley Crossing Pipeline subsidiary and transport up to 2.6 billion cubic feet of natural gas a day.

“Spectra Energy is pleased to have secured the bid to build and operate this critical infrastructure, which will provide clean-burning and reliable natural gas to support Mexico as its electric generators shift away from fuel oil and imported LNG (liquefied natural gas,” said Bill Yardley, Spectra’s president of U.S. transmission and storage, in a statement.

TransCanada’s joint venture with Sempra’s IEnova subsidiary is called the Infraestructura Marina del Golfo, or IMG. TransCanada owns a 60 percent majority stake.

“We are extremely pleased to further our growth plans in Mexico with one of the most important natural gas infrastructure projects for that country’s future,” said Russ Girling, TransCanada’s president and CEO.