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    Shell inks second LNG SPA with Mexico Pacific


Shell has now signed up for 3.7mn mt/yr of offtake from Saguaro Eneria facility. [Image credit: MPL]

by: Dale Lunan

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Shell inks second LNG SPA with Mexico Pacific

Shell Eastern Trading and Mexico Pacific Limited (MPL) said March 27 they had signed a second sales and purchase agreement (SPA) covering an additional 1.1mn metric tons/year of offtake from MPL’s Saguaro Energia LNG export facility, planned for Puerto Libertad, Sonora.

Under the SPA, Shell will purchase LNG on a free-on-board basis for 20 years from the third train of the three train, 14.1mn mt/yr first phase of Saguaro Energia. In July 2022, Shell signed its first SPA with MPL, covering 2.6mn mt/yr from the first two trains.


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“We are delighted Shell has chosen to grow with us, building upon their initial 2.6mn mt/yr commitment from train 1 and train 2, to also underpin more than 20% of train 3 capacity,” MPL CEO Ivan Van der Walt said. “Our project will provide Asia with low-cost Permian gas, avoiding the Panama Canal to ensure a shorter shipping distance to Asia, to achieve lower transportation emissions and landed pricing versus the US Gulf Coast.”

He said MPL is working toward delivering a final investment decision on the first two trains at Saguaro Energia while closing out contracting across the “significant commercial momentum” already in place for the third train.

“LNG is an increasingly important pillar of global energy security,” said Steve Hill, Shell’s executive vice president of energy marketing. “Investment in liquefaction projects is needed to avoid a supply-demand gap that is expected to emerge in the late 2020s.”

In February, MPL signed two SPAs with US major ExxonMobil covering 2mn mt/yr of offtake from the first two trains, with an option to purchase an additional 1mn mt/yr from the third train.