‘Bridge to Nowhere’ Leaves Pent-Up Permian Gas Problems Unsolved

A major Mexican pipeline opened this week after almost two years of delays. That’s the good news for drillers across the border who are seeking an expanded market for natural gas siphoned from the pent-up Permian Basin. The bad news: The conduit won’t fill to capacity until construction is completed on the new power plants it’s designed to serve. As such, the pipeline joins two others recently opened that carry minimal amounts of gas. Welcome to the stop-and-go world of Mexico power. Most recently, Mexico has offered “a bridge to nowhere” for American gas supplies, said Esteban Trejo, a Genscape Inc. analyst in Boulder, Colorado. “It’s just another example of where the pipelines are declared in service and there isn’t demand.” TranCanada Corp.’s $1.2 billion, 348-mile (557-kilometer) line, running from El Encino to Topolobampo on the coast, officially went into service on Monday, about 700 days after it was initially scheduled to open. It is one of several slated to start up this year in Mexico that have long been marked as a hoped-for solution for Permian drillers struggling to get their natural gas more easily to market at a time when production is booming and pipelines are full...MORE