Mexico Pacific announces long-term LNG SPA with POSCO International
Mexico Pacific, owner of the Saguaro Energía LNG facility and associated Sierra Madre Pipeline, announced that it has signed a sales and purchase agreement (SPA) with POSCO International Corporation (POSCO International), Korea’s largest energy trading company and a global leader in the pursuit of a sustainable future.
Pursuant to the SPA, POSCO International will purchase 0.7 million tons per annum (mtpa) of LNG on a free-on-board basis over a term of 20 years. Mexico Pacific and POSCO International are evaluating additional opportunities to expand upon this initial commercial partnership. Korea has a robust trade relationship with Mexico and is one of the only major economies in Asia that has a comprehensive free trade agreement (FTA) with the United States.
Through further engineering in collaboration with its EPC contactors, Mexico Pacific has achieved significant optimization outcomes this year, unlocking incremental LNG volumes that are financeable across global debt markets. When operational, the first phase of Mexico Pacific’s Saguaro Energía LNG facility in Puerto Libertad, Sonora, Mexico, will comprise three liquefaction trains and associated infrastructure. The LNG facility will leverage abundant, low-cost natural gas from the Permian Basin in Texas, providing the lowest landed price of LNG into Asia globally, satisfying the world’s growing energy needs and positioning Mexico as the world’s fourth largest exporter of LNG.
“We are delighted to welcome POSCO International as a foundation customer, further validating the strategic value of west coast North American LNG for Korea, one of the world’s largest LNG importing markets,” said Sungbok Park, Chief Marketing Officer of Mexico Pacific. “We look forward to a lasting fruitful partnership with POSCO International and to delivering world-class infrastructure that strengthens global energy security, reduces emissions, and improves the lives of millions of people around the world.”
With three liquefaction trains commercially contracted, strong support from governments and capital markets, and key federal, state, and municipal permits in place across the Saguaro Energía LNG facility and the Sierra Madre Pipeline, Mexico Pacific is positioning the project for a positive final investment decision (FID). Together, these developments comprise the largest private investment in Mexico and a foundational pillar of the Sonora Plan that promotes clean energy development, investment, and economic prosperity for the region.
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