Russ Girling, the Chief Executive Officer of TransCanada Corp. sees opportunities to build new oil pipelines in Mexico, which is poised to end its government's monopoly on energy development and open its oilfields up to foreign players.
To the extent that Mexico, which is already a crude exporter, is able to ramp up its flagging production as a result of the changes, it will likely be eager to send more of its crude to lucrative Asian markets – much as has been the case in Canada in recent year.
Russ Girling said, "That's where companies like us can come in with our capital and our expertise and build the infrastructure necessary to get it to a place where they can export from."
TransCanada already has two natural gas pipelines in Mexico. The Guadalajara pipeline to the Pacific Coast and the Tamazunchale line in the east-central part of the county. Oil pipelines could be TransCanada’s next move.
“That’s a market that we enjoy working in, one that we could see is above board and objective,” said Girling. “What we bring to the table is obviously our capital, but probably more importantly is our expertise in some of the more difficult terrain and remote terrain in Mexico.”
In its Mexican gas pipeline business, Girling said the company has had to deal with “startling topography.”
“There’s not many companies with the expertise we have over mountain ranges and those kinds of things.”
According to Girling, “The markets big enough for everybody…there is room for Mexico to come on. I believe that Mexico is smart as well. They are not going to be dependent on one market either. They will build pipeline access to their West Coast. The biggest growth market for crude oil in the world is the Asian market. India, China are going to drive the growth.”
Adapted from press release by Hannah Priestley-Eaton