Monday, December 5, 2022

Natural gas shortage triggers major power outage; nearly 5 million affected

Almost 5 million people in northern Mexico were affected by a major power outage on Monday morning due to an interruption in the natural gas supply caused by cold weather.

President López Obrador said the blackout affected about 400,000 people in parts of Nuevo León, Coahuila, Tamaulipas and Chihuahua, including Saltillo, Reynosa, Matamoros, Nuevo Laredo, Ciudad Juárez, Chihuahua city, Cuauhtémoc and Delicias.

However, Federal Electricity Commission (CFE) distribution director Guillermo Nevárez Elizondo later said 4.7 million people were affected by the outages in the north of the country.

“It’s due to the winter storm, the bad weather; the CFE technicians are already working [to restore power],” López Obrador told reporters at his morning press conference.

“… It won’t last long, [the issue] will be resolved,” López Obrador said.

The National Energy Control Center (Cenace) said in a statement that 58% of affected electricity supply had been restored by noon.

Cenace said the power cut was caused by cold front No. 35, which brought snow to parts of northern Mexico on Sunday, as well as a lack of natural gas. It said that approximately 6,950 megawatts of load were affected.

Cenace called on residents of Chihuahua, Coahuila, Durango, Nuevo León, Sinaloa, Sonora and Tamaulipas to reduce their power use on Monday morning to reduce pressure on electricity infrastructure.

The CFE said in a statement that a cold snap in the United States had caused the supply of natural gas from that country to Mexico to be interrupted.

“In the face of the worsening of extreme temperatures in the United States and particularly Texas, where part of the population doesn’t have electricity today, significant cuts in the supply of gas started today due to the freezing of pipelines,” the state-owned company said.

Gas-fueled power stations in Sinaloa, Sonora, Durango, Chihuahua, Coahuila and Nuevo León were affected by the cuts, the CFE said.

The company also said that U.S. authorities were prioritizing the supply of natural gas for homes and hospitals, meaning that there was less to send to Mexico.

The CFE said it was using its reserves to inject gas into power plants in Chihuahua and Nuevo León to avoid a worsening of the power outage.

“The CFE has made available to Cenace all the energy originating from other sources of generation, and with a team in Mexico and the United states is working on the reestablishment and normalization of natural gas supply from the United States,” it said.

Mexico is heavily dependent on the United States for its natural gas needs, and natural gas shortages have affected industrial production at various times in recent years.

In July 2019, the Confederation of Industrial Chambers and the National Chamber of Industrial Transformation (Canacintra) described the gas shortage as critical, explaining that several companies were only operating at 30% capacity and that states in the north, west and southeast of the country were all affected.

Canacintra said there was “clear ignorance” of the situation on the part of federal authorities.

A year earlier, the then president of the National Hydrocarbons Commission warned that Mexico should produce more of its own natural gas to reduce dependence on imports from the United States.

Mexico relies on U.S. imports for 85% of its gas needs, Juan Carlos Zepeda said in July 2018, a situation he asserted creates not only a geopolitical risk but also an operational risk due to the possibility of a natural disaster interrupting supply.

“One of the first things we have to do . . . is produce more [of our own gas],” Zepeda said, sending a clear message to then president-elect López Obrador.

But 2 1/2 years later, Mexico remains highly dependent on U.S. natural gas as the government places more emphasis on attempting to reduce its reliance on gasoline imports from its northern neighbor.

Mexico’s capacity to store natural gas and López Obrador’s opposition to fracking are also seen as barriers to greater development of gas resources here.

Guillermo García Alcocer, former chief of the Energy Regulatory Commission, predicted Sunday that Mexico would face a gas shortage due to the cold weather in the United States and asserted that greater storage capacity has been needed for years.

“Perfect storm. Freezing weather in Texas with an excess in demand for gas and electricity, together with a reduction in natural gas production … will affect the availability of gas for Mexico. We’ve needed [additional] storage for years,” he wrote on Twitter.

His prediction proved prescient less than 24 hours later.

Source: Milenio (sp), El Financiero (sp) 

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