Slumber No More: Floating LNG Set To Awaken Deepwater Mexican Gas Giant

Pemex and New Fortress Energy partner up to develop the Lakach gas field.

Flag of Mexico with blue sky
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US-based New Fortress Energy (NFE) confirmed on 22 November it had finalized agreements with Mexican state-owned oil company Pemex to develop the Lakach gas field offshore Mexico as a floating liquefied natural gas project.

Pemex suspended further development of the field, which it discovered in 2007, amid oil price declines in 2014.

The field is believed to be able to yield about 10 years of production, with the possibility of extending the reserve life if nearby Kunah and Piklis fields are developed. The area around Lakach, when coupled with these two fields, has a total resource potential of 3.3 TCF, according to NFE.

“Pemex is pleased to finalize this strategic partnership with NFE, a leading energy infrastructure company,” said Octavio Romero Oropeza, CEO of Pemex. “We believe this partnership will enable Pemex to efficiently leverage our domestic natural gas resources, fulfill Mexico’s security of supply targets, and facilitate gas-fired power infrastructure development in the region.”

NFE is set to invest in the continued development of the Lakach field over a 2-year period by completing seven offshore wells.

In addition, the company said it will deploy to the Lakach field its 1.4 MTPA Sevan Driller FLNG unit to liquefy most of the produced natural gas. The vessel is currently undergoing conversion in a shipyard in Singapore.

The Lakach FLNG unit, according to NFE, will be one of five FLNG units the company plans to deploy in the next 2 years, adding approximately 7.0 MTPA of incremental liquefaction capacity to the global market—more than half of the world’s total expected capacity additions during the 2023–2024 period, it said.

“We are pleased to finalize our strategic partnership with Pemex, which strengthens our commitment to long-term operations in Mexico and we believe demonstrates the substantial value of our integrated natural gas infrastructure business model,” said Wes Edens, Chairman and CEO of NFE. “This arrangement represents the first of what we consider to be an ideal formula for the deployment of NFE’s FLNG units to stranded gas plays around the world—one that combines gas for domestic use with low-cost supply for LNG export into global markets.”

Mexico expects gas production at Lakach to begin in the first quarter of 2024.