Nov 17 (Reuters) - U.S. energy company Sempra Energy
said on Tuesday its ECA Liquefaction subsidiary will build the
Costa Azul liquefied natural gas export plant in Mexico, the
only LNG export project in the world to get a final investment
decision (FID) in 2020.
On Friday, Mexico President Andres Manuel Lopez Obrador said
the government would give the project an export permit as long
as the company helped to offset an oversupply of gas in the
Sempra had been waiting for the 20-year export permit all
year. It was in part held up by the novel coronavirus.
ECA Liquefaction is a joint venture between Sempra's Sempra
LNG and Sempra's Mexico subsidiary, Infraestructura Energética
Nova SAB de CV (IEnova).
ECA Liquefaction will build the plant at the existing Costa
Azul LNG import plant at an estimated capital cost of around $2
billion. It is expected to produce first LNG in late 2024.
The export plant, which will have a nameplate capacity to
produce about 3.25 million tonnes per annum (MTPA) of LNG,
already has 20-year agreements with units of Mitsui & Co Ltd
and Total SE for the purchase of about 2.5
MTPA from the project's first phase.
Costa Azul's Pacific Coast location gives it an advantage
over competing U.S. Gulf Coast export plants because it is
closer to growing Asian markets. U.S. plants usually ship LNG to
Asia through the Panama Canal.
Investment demand for LNG ran high for several years due to
heavy consumption from mostly Asian countries to meet rising
energy demand and diversify fuel sources away from dirty coal
This year, however, oil and gas companies around the world
pushed back decisions on new LNG terminals after the coronavirus
caused global energy demand and prices to collapse.
(Additional reporting by Arundhati Sarkar in Bengaluru; Editing
by Shinjini Ganguli, Marguerita Choy and Barbara Lewis)