MEXICO CITY – Mexican state-owned oil giant Petroleos Mexicanos said Wednesday it has signed a letter of intent with San Antonio, Texas-based NuStar Energy to form a pipeline infrastructure joint venture.The proposed venture would help meet the growing demand in Mexico for liquefied petroleum gases and refined products, Pemex said in a statement.
Although NuStar and PMI, Pemex’s oil trading arm, have previously partnered to ship propane into Mexico, this proposed deal would be the first joint venture between the two companies and would give PMI access to various LPG and refined product suppliers on the U.S. Gulf Coast.
Because the agreement involves pipeline transport, it would reduce the cross-border flow of petroleum products via truck and thus result in “more efficient, clean and reliable” shipment of products from the United States to Mexico, Pemex said.
Under the proposed joint venture, the two companies would jointly finance the construction of new pipeline infrastructure and storage assets, which NuStar would manage and operate.
The LPGs and refined products would be delivered from Mont Belvieu and Corpus Christi, Texas, to Nuevo Laredo and Burgos-Reynosa, Mexico.
“This landmark alliance is one of the very first commercial agreements between energy companies from the U.S. and Mexico to create a JV focused on infrastructure, and it resulted from Mexico’s recently enacted energy reforms, which call for major investments in energy infrastructure and attracting foreign investment in Mexico’s energy sector,” PMI Director General Jose Manuel Carrera said.
NuStar Energy is one of the United States’ largest independent liquids terminal and pipeline operators with nearly 14,000 kilometers (8,700 miles) of pipeline and 82 terminal and storage facilities that store and distribute crude oil, refined products and specialty liquids.
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