Mexico’s Pemex awards a $ 1 billion contract for the natural gas processing plant in Ixachi

A joint venture (JV) led by Malaysia’s Coastal Contracts Bhd has won an order worth around USD 1.06 billion from the Mexican state oil company Petróleos Mexicanos (Pemex) for the construction and operation of a natural gas processing plant in the onshore gas and condensate field Ixachi secured in the state of Veracruz.

The facility will have the capacity to treat 300 MMcf / d sour wet gas at Ixachi, Pemex’s flagship natural gas development.

The Coastoil Dynamic SA de CV joint venture is a partnership between Coastal and the Mexican Grupo Nuvoil.

Coastal is an integrated provider of oil and gas services and solutions to the shipping industry, listed on the Malaysian Stock Exchange, while Nuvoil is an energy services and solutions provider operating in the upstream and midstream segments.

The EMC Papan facility will provide gas sweetening, dehydration, dew point control and liquefied gas extraction in Ixachi, Coastal said.

Ixachi was discovered by Pemex in 2017 and was Mexico’s third largest natural gas production field in November with an average capacity of 240 MMcf / d. That is below previous Pemex forecaststargeting a peak production of 638.5 MMcf / d by 2022.

Experts like Pablo Medina of Welligence Energy Analytics have identified Ixachi’s technical challenges, namely its extreme depths (3.7 to 4.3 miles) and high pressures.

The scope of work for the EMC Papan contract includes engineering, procurement, construction, and maintenance for the gas processing plant and associated infrastructure. The construction work is expected to take 250 days, and the plant is scheduled to go into operation in the second half of 2022, Coastal announced.

The joint venture commissioned the 180 MMcf / d Perdiz conditioning plant in Ixachi earlier this year, which means that the EMC Papan plant will increase the total capacity in Ixachi to 480 MMcf / d.

The EMP plant in Papan “is seen not only as a strategic project for Pemex, but also for the goal of the Mexican government to supply all Mexicans in the country with gas in the coming years,” said Coastal. “For Pemex, this project is attractive due to its proximity to the existing gas collection, separation and measurement infrastructure as well as to two large pipelines that will allow gas to be transported to central, northern and ultimately [southeastern] Mexico.”

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Mexico’s state-owned utility Comisión Federal de Electricidad (CFE) and Canada’s TC Energy Corp. have expressed an interest in developing a new offshore gas pipeline from Veracruz to the Yucatán Peninsula, similar to the 2.6 Bcf / d Sur de Texas-Tuxpan pipeline that started operating in 2019.

The company added that Ixachi “will be the most productive onshore field in Mexico once it reaches peak production.”

Octavio Romero Oropeza, CEO of Pemex, said Tuesday that Pemex is committed to increasing its production and processing of wet natural gas and resuming activities in the Lakach deep-sea natural gas field, a project that has been inactive since 2016.

Pemex’s natural gas production was 3.67 billion cf / d in November, compared to 3.59 billion cf / d in the same month last year, according to the upstream regulator Comisión Nacional de Hidrocarburos (CNH).

Pemex reported dry gas production from its processing centers of 2.05 billion cubic feet per day, up from 2.2 billion cubic feet per day for the same period last year.

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