Joint Venture Forms to Transport Natural Gas Liquids to Mexico

Strategic Insights -

A new joint venture, Rio Grande Pipeline Company, has been formed by Amoco Pipeline, Mid-America Pipeline, and Navajo Pipeline to transport natural gas liquids (NGLs) to Mexico from West Texas. The first shipments on the new pipeline system are planned for late 1996, and will transport NGLs from Hobbs Station in Texas and other Mid-America Pipeline origins to the Pemex Gas y Petroquimica Basica (Pemex) Mendez terminal in Ciudad Juarez, Mexico. This venture aims to provide a cost-effective alternative to rail and truck transportation, meeting a growing customer demand for NGLs in Mexico.

Key Takeaways:

  • The joint venture, Rio Grande Pipeline Company, will transport NGLs from West Texas to Mexico via a new pipeline system.
  • The first shipments are planned for late 1996, with a total pipeline length of approximately 10,000 miles.
  • The pipeline will be dedicated to NGL transportation and will be a common carrier system.
  • Mid-America Pipeline Company will operate the pipeline, and the joint venture will connect with the 10,000-mile Mid-America Pipeline NGL System.
  • Additional facilities will be built at the Pemex Mendez terminal in Ciudad Juarez to efficiently receive incoming shipments.
  • PMI Trading Company, a Pemex subsidiary, will purchase the NGLs transported by Rio Grande Pipeline.

Statistics:

  • The new pipeline system will have a total length of approximately 10,000 miles.
  • The joint venture will involve the purchase of an existing 8-inch pipeline and the construction of a new 8-inch line.
  • The pipeline will be capable of transporting approximately 1.5 million gallons of NGLs per day.
  • Mid-America Pipeline Company will operate the pipeline, which will be entirely dedicated to NGL transportation.
  • The joint venture will create a cost-effective alternative to rail and truck transportation, meeting a growing customer demand for NGLs in Mexico.

Sources:

  • Amoco Pipeline Company
  • Mid-America Pipeline Company
  • Navajo Pipeline Company
  • MAPCO NATURAL GAS LIQUIDS Inc.
  • Pemex Gas y Petroquimica Basica
  • PMI Trading Company