NEW ORLEANS, LOUISIANA (Pietro D. Pitts, Energy Analytics Institute, 24.Feb.2025) — Quantum Capital Group‘s short-lived love affair with Mexico, or more specifically Mexico Pacific Ltd., has apparently ended. This, without even reaching a final investment decision (FID) for the anchor phase of the proposed 30 million tonnes per annum (MTPA) Saguaro Energía LNG export facility in Puerto Libertad in Sonora, Mexico.
So, that’s it, it’s over for now, at least as originally proposed. The big Mexican wedding is off. No Bechtel. No big ring. No cake or torta. Nada de nada por ahora!
Mexico Pacific was initially pursuing development of up to 6 liquefaction trains in 2 phases. But, numerous sources with inside details of the project tell Energy Analytics Institute (EAI) that the massively planned development on Mexico’s Pacific Coast has all but collapsed as originally envisioned.
Quantum, a private equity firm with offices in Houston and New York, is the controlling owner and lead sponsor of Mexico Pacific. Executives with Quantum and Mexico Pacific had their eyes set on a possible start up for at least the 15 MTPA anchor phase of Saguaro by year-end 2027 at the earliest.
But, to date Mexico Pacific CEO Sarah Bairstow and her team haven’t been able to push Saguaro across the finish line. Bairstow took the helm of Mexico Pacific and its Saguaro project in Apr. 2024 after the resignation of then CEO Ivan Van Der Walt, who left to pursue other interests. Whether she can push the originally planned project across the finish line is seriously marred with doubts as the clock continues to work against Mexico Pacific.
In Houston, a number of Mexico Pacific’s employees have already changed their LinkedIn profile statuses to Open to Work. That’s been the case for at least one other employee in Singapore as well. Some have already found other positions, according to EAI investigations on the social platform.
South of the border, it is still uncertain what will become of the Mexico Pacific’s office in Polanco in Mexico City, which appears to be the emerging hub for any new developments and/or potentially a much smaller LNG project.
“At Mexico Pacific, we are entering a new and exciting phase, reinforcing our long-term commitment to Mexico and its role as a key player in the global energy landscape. As part of this evolution, we are consolidating our operations and transitioning our headquarters to Mexico City,” the company announced on LinkedIn on 6 Feb. 2025. “This strategic step aligns with the continued advancement of our flagship projects designed to enhance Mexico’s position as a leader in energy infrastructure and LNG exports.”
Mexico Pacific didn’t immediately respond to email requests from EAI to confirm the details. Officials with Mexico’s governor of Sonora state Alfonso Durazo didn’t immediately respond to requests either for details around the project.
Maybe Saguaro at 30 MTPA was the wrong project, in the wrong place. Drug cartels. Judiciary reform. Trump’s return in the US. That short list goes on.
This, as environmentalist continued to protest the project and its potential negative impact on endangered species in the Gulf of California spanning from blue and other great whales, whale sharks and leatherback sea turtles, according to the Natural Resources Defense Council; and as Mexico Pacific struggled to move forward 2 associated pipelines that would have transported advantaged low-cost Permian feedgas across northern Mexico’s Sonora region to the export facility in the coastal city of Puerto Libertad; and as promises of an initial $15bn FID remain just that: promises.
Saguaro was envisioned to offer Permian producers a much needed relief valve for their associated gas.
Saguaro planned to source gas from Waha. That feedgas was to later be shipped across a 253km pipeline in the US to the Mexican border and then from there along an 802km pipeline in Mexico. Both segments were envisioned to have capacity to handle 2.8 billion cubic feet per day (Bcf/d) of gas.
At the end of the day, Saguaro’s mission was to connect the US’ cheapest gas to Asia, a massive gas demand center.
And, Saguaro’s location boasted a 55% shorter shipping route for Permian gas to reach Asia. This, by avoiding the congested Panama Canal.
During a exclusive sit-down interview with Mexico Pacific CEO Bairstow at Gastech Houston in Sep. 2024, she told EAI that the prime Pacific Coast location equated to an $1/ MMbtu or more savings and a carbon emissions profile 60% lower compared to liquefaction projects located in the US Gulf Coast.
Bairstow and other Mexico Pacific executives spent the greater part of 2024 telling the market that its initial FID for Saguaro Energía LNG Phase 1 — to be comprised of 3-trains (T1, T2 and T3) with a combined processing capacity of 15 MTPA and a cost of around $15bn — was imminent.
RELATED: Mexico Pacific Working with Financial Advisors, Executive Says
Phase 1 boasted backing from the likes of US energy giants Exxon Mobil Corporation and ConocoPhillips as well as the UK’s Shell plc with key additional end-user customers secured, including Chinese firms Guangzhou Gas and Zhejiang Energy.
The initial vision for Saguaro Energía LNG Phase 2 included 3 additional trains (T4, T5 and T6) with a combined processing capacity of 15 MTPA and a similar price tag of around $15bn.
“The idea that you could have something on the Pacific Coast there was incredibly unique. It’s always had a bit of a diversified and innovative flavor to it. But the big focus, of course, was it’s a new supply point, it’s a greenfield project, so you need to get the confidence of the market and the confidence of the government,” Bairstow said during Gastech.
In the month of Gastech, the Saguaro anchor project was supposedly fully committed. Mexico Pacific had equally already optioned out over half of T4, T5 and T6, and had over 18 MTPA of incremental offtake negotiations above and beyond that.
An opportunity to modularize Saguaro was the last idea floated by Bairstow and her team at Gastech.
In the month that followed Gastech, Mexico Pacific was still working to position the liquefaction project for a FID, Mexico Pacific senior vice president, government and external affairs Patrick Hughes told EAI in a 24 Oct. 2024 email. Then, Hughes said Mexico Pacific was working with financial advisors MUFG, Santander, and JP Morgan to arrange the financing needed to support FID and transition to the next phase of development.
RELATED: Mexico Pacific Working with Financial Advisors, Executive Says
On paper and in theory it all sounded good. That, even as EAI continued to express ongoing concerns especially related to the Sonora part of the gas pipeline in Mexico, and potential issues with drug cartels, among other issues. But, unfortunately in practice and in the end, Mexico Pacific’s Saguaro project couldn’t get across that last mile, as energy pundits — Baker & Associates head George Baker in Houston and Mexico Energy Forum president Roberto Salinas León in Mexico City — discussed in detail in Dec. 2024 with EAI.
Mexico’s broader LNG export strategy now in doubt
Mexico’s surprising push in recent years to achieve LNG exporting glory hinged on 2 key infrastructure components: the liquefaction trains on Mexico’s Pacific Coast and pipeline infrastructure that would have likewise spanned from the Permian in Texas to Mexico’s western shores.
The 5 liquefaction projects initially proposed in Mexico, and only on the country’s Pacific Coast, had potential to allow Mexico to bring to market 59.1 MTPA. That’s about 7.8 Bcf/d for those using US measurement methods.
The 5 projects — proposed by Sempra Infrastructure, Mexico Pacific, and LNG Alliance Pte Ltd Singapore — had potential to convert Mexico into the third-largest LNG exporter in the Americas. This, only behind the US and Canada, according to Rystad Energy data compiled by EAI of current, approved and proposed projects.
Mexico Pacific’s stumble or fall now puts in doubt the ability of other projects to move forward for similar as well as other reasons. Only Sempra’s Energia Costa Azul (ECA) is under construction and slated to commence LNG shipments in early 2026.
For their parts, Mexico’s president Claudia Sheinbaum Pardo, Mexico’s energy secretariat Luz Elena González Escobar, Petróleos Mexicanos (Pemex) general director Víctor Rodríguez Padilla and Federal Electricity Commission (CFE) general director Emilia Calleja Alor, haven’t uttered words about Mexico’s LNG potential in the first 100 days of the Sheinbaum presidency. And, thereafter nothing has been uttered about LNG from the quartet that sings often about energy sovereignty.
Even Sheinbaum’s ambitious $277bn Plan Mexico seemingly avoids mention of Mexican LNG potential as her administration focuses attention on strengthening state-owned CFE and heavily indebted Pemex.
RELATED: Sheinbaum Says Trump’s Tariffs to Impact Mexico and the US
And, with the 20 Jan. 2025 return of Donald Trump to The White House, Sheinbaum and her administration have bigger fish to fry as they deal with threats of tariffs on Mexican exports to the US, which if implemented have potential to tilt the Mexican economy into negative growth territory.
For now, at the end of regulation time: The marine species and anti-Morena Party factions 1. Mexico Pacific nil.
____________________
By Pietro D. Pitts reporting from New Orleans. © 2025 Energy Analytics Institute (EAI). All Rights Reserved.
