Mexico Welcomes Its First-Ever LNG Cargo

Terminal de LNG de Altamira, a joint venture between Royal Dutch Shell plc (50 percent), Total and Mitsui (each 25 percent), on Thursday announced the arrival of the first liquefied natural gas (LNG) cargo ever to be delivered to Mexico.

The 138,000-cubic-meter, Shell-owned LNG cargo was delivered to Mexico's first LNG regasification terminal near Tampico, Tamaulipas, on the country's Northeast coast, by the Shell-operated vessel SS Gracilis, after a 14-day, 6,257-nautical miles journey from the Nigeria LNG plant in Africa. The arrival of the cargo signals the start of the commissioning phase at Altamira. Subsequent LNG cargos will be delivered by both Shell and Total, as holders of 75 percent and 25 percent respectively of the terminal's capacity rights.

Mateo Lopez-Colome, Managing Director of Terminal de LNG de Altamira, said: "Altamira is the first energy infrastructure project of its kind in Mexico and the arrival of the first LNG cargo marks the end of the terminal's construction and the start of the commissioning phase. We are proud to have reached today's milestone safely, on-time and within budget, and we now look forward to the successful completion of the commissioning phase and the start of commercial operations."

Once fully operational, Terminal de LNG de Altamira will provide Mexico with an additional source of energy, which will further strengthen the country's security of supply. LNG deliveries will also support Mexico's energy policy by fueling new power generation to meet an expected growth in demand in a timely fashion. Mexico's power authority, Comision Federal de Electricidad (CFE), has contracted to purchase 5.2 billion cubic meters of regasified LNG per annum from Altamira (equivalent to 3.9 million tonnes of LNG per year), which will be used for power generation to support existing and future industry in the region.

Commercial deliveries of natural gas to CFE are expected to commence in October 2006. A ceremony commemorating the terminal's full operational start- up is scheduled for early next year.

The Altamira LNG project consists of two 150,000 cubic-meter-capacity, full-containment outer-concrete/inner steal tanks for LNG storage, re-gasification facilities and pipelines to connect to the existing pipeline system in Tamaulipas. The project also includes marine installations, allowing specially designed 180,000 cubic meter carriers to supply LNG to the terminal.

LNG is natural gas cooled to minus-161 Celsius to reach its liquid state. Its volume is 1/600 of natural gas in vapor form, which allows it to be transported long distances by specially-designed ships to markets, including Mexico, where demand for natural gas is strong. When LNG is delivered to regasification terminals such as Altamira, it is warmed back into a gaseous state for delivery to customers via standard natural gas pipelines.

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