Reynosa Pipeline Rupture Sends U.S. Natural Gas South

A pipeline rupture in Mexico is being blamed for a deadly gas production facility explosion near the border city of Reynosa. Officials from Mexico's state-run oil company Petrolos Mexicanos (Pemex) say dozens were injured and as many as thirty perished in the September 18 blast.

Image courtesy of conexiontotal.mx

Natural gas imports to the Pemex facility have been on the rise over the past few years and with this incident, that number will have to increase further. Pemex production chief Carlos Morales said the oil giant would have to import more natural gas from the U.S. via pipelines that run through Reynosa as well as increase imports of liquefied natural gas (LNG) to the Altimira Port on the Gulf and the Manzanillo Port on the Pacific Coast. In the period January-July 2012, Pemex averaged imports of 1.02 billion cubic feet per day, up from 842 million cubic feet per day over the same period last year.

In wake of the blast, Pemex now expects to import up to 300 million cubic feet per day through the Reynosa pipeline and a combined 400 million cubic feet per day from the Altamira and Manznailla Ports. This is in addition to Pemex's own 100 million cubic feet per day outlay.

Estimated damage runs in the neighborhood of $150 million. Pemex was already running short on natural gas and has since issued a series of critical alerts forcing industry to curb natural gas use. The U.S. is reporting natural gas inventories in ample supply and should have no problem filling the gap.