Regional LNG: DKRW plans LNG plant in Sonora - Mexico

Houston based energy infrastructure company DKRW Energy LLC, through its wholly owned subsidiary Sonora Pacific Liquefied Natural Gas (LNG) and the Government of Sonora, Mexico announced on Tuesday the signing of a Cooperation Agreement to build a 1.3 billion cubic foot per day (bcfd) LNG regasification terminal at Puerto Libertad, Sonora on the Gulf of California.

Signed agreements include an option for Sonora Pacific LNG to purchase the land for the terminal from the state government. The project includes pipelines to distribute gas throughout Sonora and an interconnection with the El Paso pipeline system east of Tucson to serve the Arizona and California markets.

"....we think the Puerto Libertad site is the best in the western region of North America," said Tom White, DKRW Energy partner and managing partner of Sonora Pacific LNG. "Our strategic location provides direct access to the rapidly expanding gas market in Sonora, could be extended south to Sinaloa and is a short distance from Arizona and California markets."

Partners in the project include Bechtel Corporation and CBI as project builders, Andrews Kurth, LLP as legal counsel and El Paso Pipeline Company for infrastructure and interconnects.

Scheduled to begin construction in mid-2005 and be in operation by mid- 2008, the Sonora Pacific LNG project includes a 1.3 bcfd regasification and storage terminal at Puerto Libertad, gas pipeline infrastructure in Sonora, possibly including Sinaloa, and a 36" export pipeline through Nogales to interconnect with the El Paso Pipeline system east of Tucson. Initial estimates call for 500 mmcfd of gas to be consumed in Sonora, primarily in the power generation sector, while 800 mmcfd will be shipped to the United States.(alex)