Photo: Illustration only; Courtesy of Mexico Pacific

Shell to buy 2.6 mtpa of LNG from Mexico Pacific

Shell Eastern Trading and a subsidiary of Mexico Pacific have signed a sales and purchase agreement for Shell to offtake 2.6 million tonnes per year (mtpa) of LNG from the first two trains of Mexico Pacific’s LNG export facility.

Shell to buy 2.6 mtpa of LNG from Mexico Pacific
Illustration only; Courtesy of Mexico Pacific

Mexico Pacific Limited is a North American LNG export project on the West Coast of Mexico. The LNG export facility is located in Puerto Libertad, Sonora. When fully operational, the facility will have three trains and a combined capacity of 14.1 mtpa. The facility is to start commercial operations in 2026.

Under the sales and purchase agreement, Shell will purchase LNG on a free-on-board basis over a term of 20 years.

“We are delighted to welcome Shell as a foundation customer at our anchor LNG facility,” said Douglas Shanda, CEO of Mexico Pacific. “Their recognition of the advantages our location offers, including access to low-cost Permian gas, avoidance of the Panama Canal to ensure a shorter shipping distance to Asia, and lower landed pricing, demonstrates the value of West Coast North American LNG.”

“Energy security remains paramount for the world. The demand for LNG is set to continue to rise with further LNG required to ensure security of supply and progress the energy transition,” said Steve Hill, executive vice president of Energy Marketing at Shell. “We look forward to continuing to work with Mexico Pacific as they advance to bring more LNG online.”

Related Article