Mexico Pacific Secures 20-Year LNG Supply Agreement with POSCO International

Mexico Pacific, a major player in the energy sector, has entered into a strategic partnership with POSCO International, a leading global energy trading company. This collaboration involves a sales and purchase agreement for liquefied natural gas (LNG) from Mexico Pacific's Saguaro Energía LNG facility and Sierra Madre Pipeline. This partnership aligns with both companies' commitment to sustainable energy solutions and strengthens Mexico Pacific's position in the global LNG market.

Under the Sales and Purchase Agreement (SPA), POSCO International is set to acquire 0.7 million tonnes per annum (mtpa) of liquefied natural gas (LNG) from Mexico Pacific over a 20-year period, with deliveries on a free-on-board basis. This agreement marks the beginning of a significant commercial partnership, and both parties are exploring further opportunities to expand their collaboration. Korea, with its strong trade ties to Mexico and its unique status as one of the few major Asian economies with a comprehensive free trade agreement (FTA) with the United States, is well-positioned to benefit from this deal.

Mexico Pacific has made substantial strides in optimizing its LNG production through enhanced engineering efforts in partnership with its EPC contractors. These improvements have enabled the unlocking of additional LNG volumes that are now financeable via global debt markets. The initial phase of the Saguaro Energía LNG facility in Puerto Libertad, Sonora, Mexico, will feature three liquefaction trains and necessary infrastructure. By utilizing low-cost natural gas from the Permian Basin in Texas, this facility aims to offer the most competitively priced LNG in Asia, reinforcing Mexico’s position as the world's fourth-largest LNG exporter and addressing the growing global energy demand.

Sungbok Park, Chief Marketing Officer of Mexico Pacific, expressed enthusiasm about POSCO International joining as a foundational customer, underscoring the strategic importance of west coast North American LNG for Korea, a major global LNG importer. He highlighted the anticipated long-term benefits of the partnership, including the development of top-tier infrastructure that will enhance global energy security, lower emissions, and positively impact millions of lives worldwide. Park's comments reflect a commitment to leveraging this collaboration to address global energy needs while promoting sustainability and improving quality of life.

Mexico Pacific's progress towards a final investment decision (FID) for its Saguaro Energía LNG facility and Sierra Madre Pipeline is bolstered by strong commercial contracts, government support, and secured permits. The company's three liquefaction trains, coupled with its financial backing and regulatory approvals, position it favorably for a successful project execution. These advancements represent the largest private investment in Mexico to date and are a cornerstone of the Sonora Plan, which aims to drive clean energy development, attract investment, and foster economic growth in the region.