Monterra Energy announces refined products pipeline in Mexico

Monterra Energy has recently announced its plan to build a refined products pipeline to improve efficiency and competition in Central Mexico. Monterra is an independent midstream company that has an equity commitment from KKR, a global investment firm, and specializes in the development and acquisition of midstream infrastructure in Mexico.

The pipeline will address critical infrastructure needs to transport imported refined products from the port of Tuxpan, Veracruz, into Central Mexico near Tula, Hidalgo. This private pipeline investment will be made possible by the Mexican energy reforms. Mexican consumers will benefit from a more efficient and competitive market with both domestic and imported fuels.

The pipeline will be 18 inches in diameter with a capacity of up to 165,000 barrels per day. Monterra has access to an existing right-of-way that will expedite development and construction and allow an early commercial operation date.

Monterra will anchor the project with two industry leaders, Mexican gas station consortium G500 as well as a leading global commodities merchant, which together will account for a significant portion of the project’s initial throughput volume of 100,000 barrels per day. Monterra will launch an open season in March 2016 for the remaining capacity.

Arturo Vivar, CEO of Monterra Energy, said:

“Thanks to the historic energy reforms instituted by President Enrique Peña Nieto, Monterra and our Mexican partners are able to make investments that will ultimately enable Mexican citizens to have choice in fuels and benefit the Mexican economy with private investment in new infrastructure.”

Antonio Caballero, President and Chairman of G500, said:

“G500 is pleased to participate in such an important infrastructure project for Mexico and continue positioning ourselves as one of the leading gasoline retail groups in the country. Our retail shareholders will benefit from our association with Monterra, as well as with our other strategic partners, in critical pipeline and storage projects, among others, in our regions of influence.”

Michael Williams, President of Monterra Energy, added:

“We are thrilled to have the support of two industry leaders and look forward to serving the needs of others through the development and construction of the Tuxpan-Tula Pipeline.”