Mexico has limited access to liquid fuels points of supply: import points and refineries. The country faces daily a challenge for transportation because several major consumption points are far from supply. Storage can provide relief to these problems, because it increases energy security and provides liquidity on markets by stabilizing the impact of volatility on supply and demand.
Within this environment, storage becomes the distribution center needed to reach every corner of the country. The remaining question is whether Mexico has enough operating and planned storage to cover all demand.
At the beginning of 2020, 92 fuel storage terminals provide service in Mexico (85% belong to Pemex, while private parties own the rest). These terminals have an operating capacity of almost 31 million barrels, that represents approximately 25 days of demand (2019). However, not all the capacity is being used and its dispersal is not efficient to attend all consumption points properly.
Four states concentrate more than fifty percent of the gross storage capacity in the country: Veracruz, Michoacan, Baja California, and Sinaloa.
The Energy Regulatory Commission (CRE) has granted storage permits to 30 firms, but most of them have not started operations. Most of this new storage will be installed in Veracruz, Colima, and Estado de Mexico and shall add 18 million barrels of capacity.
Market participants in Mexico would benefit from a deep analysis of storage facilities, which should consider: i) available capacity in current infrastructure; ii) future capacity in infrastructure under development –expected date of conclusion, capacity, etc.–; iii) supply coverage –proximity to consumer centers and supply points–; iv) interconnection to transportation modes, and v) current regulation loopholes. This will allow to improve its logistics performance, as well as to have enough resilience to increase their portfolio of clients and manage risks.
Anuario Estadístico Ferroviario, 2018. Agencia Reguladora del Transporte Ferroviario
Sistema Portuario Nacional. SCT
Sistema de Información Energética. SENER
Registro Público de Permisos. CRE
Registro Público de Permisos. SENER
Prospectiva de petróleo crudo y petrolíferos 2018-2032. SENER
Trains are an excellent alternative to transport large volume of fuels, mainly due to the current security situation with pipelines. Mexico has over 23 thousand kilometers of operational railroads throughout the country. Many of which have access to import points on the border or marine ports.
Due to the geographical conditions and long distances between import points and consumption centers, marine infrastructure
is fundamental for supplying the whole country.
Mexico has 117 ports (various capacities): 59 on the Gulf of Mexico and 58 on the Pacific.
David provides solutions for business development, regulatory compliance and feasibility analysis for natural gas and liquids projects. He has experience designing strategies to identify supply, demand and funding for infrastructure projects, including a deep feasibility analysis due to a profound understanding of the regulatory environment and the regional energy balances involved in each case, both for natural gas and liquid fuels.
Daniela Flores oversees the tailoring of midstream and downstream regulatory compliance schemes. Her areas or expertise include analysis of natural gas and liquids markets as well as first-hand experience on the implementation of procedures to guarantee not only regulatory compliance but also assure supply, demand and infrastructure review for a comprehensive advice in each of our clients' energy projects.