A lack of refining capacity in Mexico means that oil product imports will continue to increase, and infrastructure investments are now being made to capitalise on these market dynamics
The storage and transport games started long ago, back in 2013, when several investors saw the potential demand for refined imported products from Tuxpan Veracruz.
According to the Oil Prospective 2015-2029 report, during this period oil national production will increase by 24.1%, while demand will also increase by 35.9%. This means that due to a lack of Mexican refining capacity, at least
for the next 12 years, Mexico will continue to increase its imports of oil products. So far, imports have already increased by 25% from 2014 to 2016, and the US has played an important role, providing 83% of imports.
In order to support the new demand, investments in infrastructure are now being made. Currently, there are three important pipeline investments for oil products storage and transportation.
The first is in Tuxpan, Veracruz, one of the most important ports, receiving 36% of the oil products imports in central Mexico. There, Sierra Oil & Gas, TransCanada and Grupo TMM are building an $800 million project that includes a marine terminal near Tuxpan, a 265 km pipeline with a capacity of approximately 100 thousand barrels per day from Tuxpan to central Mexico, and an inland storage and distribution hub in central Mexico with storage capacity of 1.2 million barrels.