Stabilis Energy moves ahead with small-scale LNG plans in Mexico

U.S. LNG producer and provider Stabilis Energy has made further progress in its push to expand its presence in the Mexican LNG market. 

Illustration purposes only (Image courtesy of Stabilis Energy)

The company said on Wednesday it has filed a permit application to build and operate a small-scale LNG production facility in Monterrey, Nuevo Leon, Mexico. Stabilis has also started signing LNG supply agreements with Mexican customers for sales from that location.

The permit application seeks approval to install two LNG production units at a Monterrey. The first unit is a 20,000 gallon per day LNG production facility that Stabilis currently owns and can deploy immediately.

The second unit is a 100,000 gallon per day LNG production facility that would be similar to the one that Stabilis currently operates in George West, Texas, the statement reads.

The proposed facility will be located on industrial property owned by affiliates of Stabilis’ joint venture partner, CryoMex Investment Group.

Stabilis formed a joint venture with CryoMex Investment Group in 2019 to pursue investments in distributed natural gas production and distribution assets in Mexico.

The site includes access to the natural gas and electricity supplies required to operate an LNG production facility. It also provides easy access to major highways for truck distribution.

Stabilis expects the permitting process to take approximately 6-9 months to complete before construction will begin, with the production expected to begin by the end of 2020.

In connection with the production facility development Stabilis recently signed a multi-year LNG supply contract with a new industrial customer that could require up to 25,000 LNG gallons per day once fully operational. Stabilis is currently pursuing other similar LNG supply agreements with multiple customers.

LNG will be provided from the Monterrey facility once it is commissioned. In the interim, LNG will be provided from Stabilis’ existing facility in Texas.

LNG transportation, storage, and vaporization equipment will be provided from Stabilis’ existing fleet.

Stabilis recently opened an LNG transportation hub to facilitate the delivery of up to 50,000 LNG gallons per day to customers in Northeastern Mexico. LNG is supplied by the Stabilis liquefaction facility in George West, Texas. The transportation hub is designed to increase supply security to Stabilis’ customers by reducing border crossing and related logistics risks.