Mexico energy regulator CRE suspends part of natural gas open access regulation

-CRE suspends part of open access regulation

-Sources mull whether decision is related to imminent start of Monte Grande interconnection

-Regulation stall benefits state-run capacity holders

HOUSTON (ICIS)–Mexican energy regulator CRE session a temporary suspension of a portion of Mexico’s that has the potential to decrease transparency for future capacity releases in the developing gas market.

The portion of the regulation suspended refers to a requirement that those who ship, store or manage natural gas, which would include TSO CENAGAS, would have 90 business days to present to CRE proposed commissions for open seasons or other capacity-release mechanisms.

Market participants said they were confused by the decision. One called the decision “strange” while others questioned whether it had anything to do with the potential or impending start of the 500 million cubic feet (mcf)/day Monte Grande interconnection, which seems more likely now that upstream Sur de Texas – Tuxpan submarine pipeline has received its highest nominations to date as of 17 and 18 December since starting in mid-September, according to data from US-based provider Criterion.

CRE did not respond for comment.

The latest available pipeline status update published by energy ministry SENER in October says the technically-complete Monte Grande interconnection would start testing once all sections of the Sur de Texas – Tuxpan pipeline were complete. The update also says CENAGAS could hold an open season for Monte Grande, but it would not necessarily be obligated after the CRE’s temporary suspension of a portion of the 2018 open season regulation, even if in the future the infrastructure has idle capacity for an extended period of time.

“It seems like a state company would be the beneficiary of this delay or exemption,” said one source.

The potential effects of the temporary suspension in 2020 would depend upon how long the suspension remains in place and how it is interpreted by capacity holders, including key capacity holder state-run utility CFE. The suspension may open the door to less-transparent means of allocating idle capacity, though further study of Mexico’s open access regulations would be required to determine if it could exempt those who ship, store or manage natural gas from open seasons altogether.

CRE’s board of commissioners also approved the 2020 zonal tariffs for the national Sistrangas grid, but the details of these do not appear to have been published, yet.

CFE

CRE’s decision comes just days after utility CFE’s administrative council new guidelines for CFE International to “efficiently optimise” its US contracts to become profitable, according to a company press release. At the same meeting, it approved guidelines for natural gas and related transport prices to CFE power plants operating under legacy contracts as well as to third parties.

The head of CFE International and CFEnergia, the company’s fuels trading arm, Miguel Reyes, said at the same meeting he was working to ensure the supply of competitively-priced fuels to CFE’s plants and to industrial customers at “market prices” and “without intermediaries.” These statements may signal the new administration has begun to embrace CFEnergia’s potential to improve the CFE’s financial situation.

CENAGAS

CENAGAS told Sistrangas users their November invoices would be late due to the effects of a November ransomware attack on state-run producer Pemex, according to a document obtained by ICIS.

The document says Pemex declared a force majeure on 20 November for its normal operational and maintenance services for the Sistrangas and CENAGAS would be unable to issue its usual metering report and related invoices for November.

CENAGAS said the invoices would be delivered through the usual channels in December.