Sempra hits 85% construction mark at natural gas liquefaction project in Mexico drawing closer to first LNG

Sempra Infrastructure, a subsidiary of North America’s energy company Sempra, has made inroads in the construction of a liquefied natural gas (LNG) project, making the Energia Costa Azul (ECA) LNG receipt, storage, and regasification terminal richer for natural gas liquefaction capabilities north of Ensenada in Baja California, Mexico.

Even though recent months were marked by labor and productivity challenges, Sempra underlines that the construction at Energía Costa Azul LNG Phase 1 is approximately 85% complete. Therefore, mechanical completion and the first LNG are anticipated to occur in 2025, with the timing of commercial operations under the sales and purchase agreements targeted for spring 2026.

Previously, commercial operations at ECA LNG Phase 1, which received a non-free trade agreement (FTA) export authorization in 2019, were expected in 2025 with the first LNG in late 2024. According to Sempra, ECA LNG was the only LNG-export project in the world to reach a final investment decision (FID) in 2020.

Since the project is located on Mexico’s West Coast, it is believed to be geographically positioned to connect Asia, the Pacific Basin, and international LNG markets alongside potential markets on the west coast of Mexico to North American natural gas supplies directly from the Pacific coast.

The project has been designed to add liquefaction trains and other related facilities to the existing ECA regasification terminal, which includes one marine berth and breakwater, two LNG tanks of 160,000 cubic meters each, LNG vaporizers, nitrogen injection facility, and pipeline interconnections.

While ECA LNG Phase 1 is a single-train LNG facility with the capability to export approximately 3.25 million tonnes per annum (mtpa) of LNG, ECA LNG Phase 2 is being developed to expand this by adding around 12 mtpa of LNG export capacity with two trains and one LNG storage tank.

The LNG project secured a definitive 20-year sale and purchase agreements with Mitsui & Co., and TotalEnergies for a total of 2.5 mtpa of LNG from Phase 1, for which a lump-sum, turn-key engineering, procurement, and construction (EPC) contract was inked in February 2020 with an affiliate of TechnipFMC.

Jeffrey W. Martin, Chairman and CEO of Sempra, noted: “Our company is well-positioned for continued growth across each of our business platforms, which are benefitting from ongoing electrification, economic development, and demand for safe, reliable and cleaner energy.”

According to Sempra Infrastructure, strong global demand for cleaner and more secure energy supports its activities across LNG, energy networks, and low-carbon solutions business lines. As a result, Port Arthur LNG Phase 1 in Jefferson County, Texas, is under construction while the proposed Phase 2 expansion project is making steady progress.

In June 2024, the company signed a non-binding heads of agreement with Aramco, contemplating the purchase of 5 million tonnes per annum of LNG and a 25% equity investment in Phase 2. The following month, Sempra Infrastructure took another step forward in developing Port Arthur LNG Phase 2 by entering into a fixed-price EPC contract with Bechtel Energy.

The deal with Bechtel is said to provide the opportunity for a continuous construction process from Phase 1 to Phase 2, contributing to the operational benefits and economics of the brownfield expansion.