Mirage Energy Corp (MRGE)

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Jul 13 (Common Sense) - 26 years ago, when Michael Ward, CEO of infrastructure company Mirage Energy, set a goal to establish an underground natural gas storage terminal in Mexico, few believed it would be an achievable project.

"Some believed he was crazy," Ward admitted in an interview.

After a quarter of a century of patience, work and a local energy reform, Mirage is about to start construction of the first terminal of this type in the country --whose permits are still in process--, which will help Mexico to increase the practically non-existent storage capacity of this hydrocarbon.

Ward's vision, in line with the name of his company Mirage , in Mexico is now bearing fruit, but not only for his long-awaited storage project, valued at 1.2 billion dollars that he considers a pipeline that will transport gas to the country from the Permian basin passing under the Río Bravo (Grande), the tributary that marks the border between the two countries.

Mirage will also rehabilitate the infrastructure to transport natural gas to the gates of the Yucatan peninsula and will participate in another strategic project for the transportation and distribution of hydrocarbons through the Isthmus of Tehuantepec.

In contrast to the skepticism that it encountered in the past, the businessman's Mexican bet is being seconded and was recently backed with four billion dollars of financing for these investments , an achievement that stands out as it was granted in the midst of the crisis and uncertainty generated by the covid-19 coronavirus pandemic.

Investments for the execution of large Mirage projects surprise even more because they correspond to a sector that is a priority for the current administration of President Andrés Manuel López Obrador, a left-wing president who is suspicious of the participation of private initiative since the execution of the 2013 energy sector reform.

This vision has put, for example, big companies in the industry such as Infraestructura Energética Nova, (IEnova) --the local subsidiary of Sempra Energy-- or Carso Energy, a company controlled by the family of businessman Carlos Slim, because the The government considered the contractual terms of several natural gas transport projects to be disadvantageous to the Federal Electricity Commission (CFE), the state-owned electricity company.

That will not be the situation that Mirage is facing, the company has reached out to the government as an ally, rather than as a competitor in state companies such as Petróleos Mexicanos, obtaining concessions in key projects for the Federal Government, from which it will be able to achieve their public policy objectives and benefit economically, without having to spend a penny, a key point of the López Obrador government's austerity approach.

"In my opinion, if you are not competing with them and your projects are helping them - the government - in matters that they really need, things will go very well, I am not saying that there will be no issue, but so far we have not seen none, ”said Ward, who has 45 years in the industry and also founded the company, Tidelands Oil and Gas, which until 2008 had a stake in the Frontera pipeline, which transports natural gas from the state of Texas to northern New Lion.

The company, based in San Antonio, Texas, recently obtained the concession to manage the exhausted oil field known as Brazil for the next 35 years, which will increase the country's natural gas storage capacity from 1.5 days of national consumption to six months. , when it is fully operational, reinforcing Mexico's energy security, one of the objectives of the Lopezobrador government.

This terminal will be the largest natural gas storage center in North America when fully developed.

In fact, its implementation will allow the country to exceed the objectives established by the previous government, under the presidency of Enrique Peña Nieto, of having the necessary storage infrastructure to meet a minimum demand of three days in 2022 and store at least five days to 2029.

The project will bring to Mexico a widely developed technology in the United States, where there are 400 underground storage terminals, which provide approximately 20% of all natural gas consumed during the five months of the cold season in the country, when it is required to heating.

This project connects to another Mirage initiative that considers rehabilitation of a pipeline that runs from Tamaulipas to Nuevo Pemex, east of Coatzacoalcos, Veracruz. The pipeline that was previously used only to carry gas from Cantarell to the north of the country, will be rehabilitated to operate bidirectionally, which will allow to bring natural gas, now cheap, from the Permian basin to the Yucatan Peninsula.

Its start-up will improve access to natural gas in the area - one of the problems faced by the current administration - a situation that was linked to problems of electricity supply last year and access to supplies for some industries. .

“We consider that the generation that exists in Yucatan, the generation that is there, is in theory sufficient to cover the demand of the peninsula, in all of it, [but] it needs to be reinforced, there needs to be more generation. . . because we need to have a lot of energy as we are a part of the country that has great possibilities for development and has been abandoned, ”said Manuel Bartlett, CEO of CFE, in July 2019.

Mirage's help will also be useful to launch one of the current administration's major projects, which involves the development of the Isthmus of Tehuantepec.

There Mirage, in alliance with the Mexican Northern Hemisphere Logistics, will support Petróleos Mexicanos to develop the Interoceanic Corridor Project of the Isthmus of Tehuantepec, which consists of the construction and operation of two marine terminals for the transfer of fuels between the Pacific Ocean and the Gulf of Mexico, which will allow attracting supercarrier traffic that will see the transport of energy currently reduced through the Panama Canal be reduced by up to 36 days.

The project, valued in total at six billion dollars, will be built in two stages that will conclude in 2022. With it, Mexico plans to reactivate the region and generate 5,000 jobs.

The initiative is a bet that seems to favor Pemex, since it will not disburse resources for the development of the project and will receive an equivalent amount of resources for each income it receives during the duration of the concession.

In addition, it will allow the López Obrador government to guarantee the existence of energy for the development of southern Mexico.

"They want to develop the corridor of the Isthmus, make it a great economic hub . . . and in order for people to come and build industrial parks, businesses must have a good supply of energy, and we will solve that problem to a large extent. ”


https://www.sentidocomun.com.mx/articulocs.phtml?id=85170