Mexico Manages 20% Drop in U.S. Gas Supply
Mexico Manages 20% Drop in U.S. Gas Supply as Storage Risk Emerges
MONTREAL (Oil Monster): Mexico has managed a temporary reduction of about 20% in natural gas deliveries from the United States, but the disruption has highlighted the country's heavy reliance on imported gas and limited ability to withstand a prolonged supply interruption.
Cuitláhuac García Jiménez, director general of Mexico's National Center for Natural Gas Control, or CENAGAS, said officials were notified roughly a week earlier that about one-fifth of the imported gas entering Mexico through its pipeline system would temporarily stop flowing.
He described the potential reduction as a significant challenge but said coordination among CENAGAS, Pemex, the Federal Electricity Commission, the National Energy Control Center and the Energy Ministry allowed the system to manage the disruption without major supply problems.
- Mexico was notified of a temporary reduction of roughly 20% in U.S. pipeline gas deliveries.
- Mexico imports approximately 75% of the natural gas it consumes from the United States.
- CENAGAS says Mexico does not currently have dedicated strategic natural gas storage.
- Pipeline inventories and coordinated operating measures could provide up to roughly three days of flexibility during a complete import interruption.
- Natural gas supplies a large share of Mexico's electricity generation.
- The government is pursuing additional pipelines, domestic gas production, renewable generation and efficiency measures to reduce import dependence.
Mexico Absorbs Temporary 20% Supply Reduction
García said U.S. suppliers notified Mexico that approximately one-fifth of the imported natural gas entering the national pipeline system would temporarily become unavailable.
The reduction was potentially significant because Mexico depends on continuous cross-border pipeline flows to supply power plants, industrial users and other consumers.
Federal energy agencies coordinated pipeline operations and available domestic supply to keep the system functioning during the disruption.
Mexico Imports About 75% of Its Natural Gas
The incident underscores the scale of Mexico's dependence on the United States for natural gas.
President Claudia Sheinbaum has said approximately 75% of the natural gas consumed in Mexico currently comes from U.S. imports.
Government data presented earlier this year put national consumption at roughly 9.1 billion cubic feet per day, with imported gas providing most of that requirement.
Much of the imported gas originates in U.S. shale-producing regions, particularly Texas.
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Three-Day Cushion Is Not Strategic Gas Storage
CENAGAS said Mexico currently lacks dedicated strategic natural gas storage capable of supporting the country through an extended import disruption.
Instead, gas already contained within the national pipeline network, combined with operational measures and coordination among energy agencies, could provide enough flexibility to manage a complete import interruption for up to approximately three days.
The distinction is important: the three-day figure should not be interpreted as three days of gas held in conventional underground or above-ground strategic storage facilities.
Power System Is Highly Exposed to Natural Gas Supply
Mexico's dependence on natural gas extends well beyond industrial consumption.
Government officials have said around 60% of the country's electricity is generated using natural gas, making reliable pipeline deliveries critical to the power system.
A prolonged interruption in U.S. supplies could therefore affect electricity generation as well as industrial operations.
That vulnerability has become increasingly important as Mexico adds new combined-cycle power capacity and electricity demand grows.
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Mexico Is Investing Billions in Gas Infrastructure
The government has already announced a major expansion and modernization program for the country's natural gas transportation network.
OilMonster reported earlier this year that approximately 140.9 billion pesos of pipeline and infrastructure investment is planned through 2030.
The program includes new pipelines, modernization projects, rehabilitation work and additional capacity designed to improve the reliability of gas deliveries to power plants and industrial centers.
CENAGAS manages a national gas system extending more than 20,000 kilometers, supplemented by pipelines operated by CFE, Pemex and private companies.
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Government Wants to Reduce U.S. Gas Dependence
Sheinbaum has said reducing the continued growth of imported natural gas is a central objective of the government's energy strategy.
The administration is not planning to eliminate U.S. gas imports, which are expected to remain an important part of Mexico's energy supply.
Instead, the government wants to reduce the country's exposure by increasing domestic production, improving efficiency and expanding other sources of electricity generation.
Renewables Form Part of the Supply Strategy
Mexico plans to increase solar, wind, geothermal and other renewable generation in an effort to limit future growth in natural gas demand.
Additional renewable capacity could reduce the amount of gas required by the electricity sector, particularly as overall power consumption increases.
The government is also pursuing efficiency programs intended to reduce growth in national energy demand.
Mexico Examines More Domestic Gas Production
Another part of the strategy involves increasing domestic natural gas supply.
Officials are examining opportunities to capture gas that is currently flared during oil production and to expand conventional gas output.
The government is also studying whether unconventional resources in northeastern Mexico could be developed using technologies designed to address environmental and water concerns.
Potential areas under study include geological formations in Coahuila, Nuevo León and Tamaulipas.
Recent Cut Highlights Storage Gap
The temporary reduction in U.S. deliveries has renewed attention on a weakness that energy analysts have identified for years: Mexico has very limited ability to store large quantities of natural gas for emergencies.
Unlike countries with large underground storage caverns or depleted fields dedicated to strategic reserves, Mexico depends heavily on continuous pipeline flows.
CENAGAS has previously said it is studying potential storage options, including depleted hydrocarbon reservoirs.
Cross-Border Gas Trade Remains Critical
U.S. pipeline exports to Mexico have risen sharply over the past decade as low-cost American gas has supplied Mexican electricity generation and industry.
OilMonster reported that U.S. pipeline gas exports to Mexico reached a record 7.5 billion cubic feet per day in May 2025.
That trade relationship has supported lower-cost energy in Mexico but has also increased the country's exposure to weather events, infrastructure outages and other disruptions north of the border.
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What Happens Next
Mexico's immediate gas system has continued operating despite the temporary reduction in U.S. deliveries.
The larger issue is whether the incident accelerates investment in strategic storage, domestic gas production and alternative electricity generation.
The government's longer-term strategy is intended to maintain access to U.S. gas while reducing the risk created by depending on imported supply for roughly three-quarters of national consumption.
Explore More on OilMonster
- Mexico's Gas Dependence Deepens Despite Refining Gains
- Natural Gas to Remain Key to Mexico's Energy Security
- Mexico Announces $8.1B Natural Gas Pipeline Expansion
- U.S. Natural Gas Pipeline Exports to Mexico Hit New Record
Sources: CENAGAS; Government of Mexico; Xinhua.
Courtesy: www.chinadailyhk.com