Mexico Pacific Limited has filed an application for a seven-year extension of the export deadline for its Saguaro Energia LNG plant with the US Department of Energy (DOE), local media Mexico Business News reported on July 17.

In its filing, the Houston-headquartered company said it would not be capable of beginning commercial operation before its current December 2025 deadline due to “circumstances beyond its control”.

The US$15bn project located in Puerto Libertad in the Northwest Mexican state of Sonora has attracted considerable interest as a potential alternative source of LNG supply for gas-hungry markets in Northeast Asia to the US Gulf Coast producers.

Gas shipped from western North American export terminals is highly sought after by Asian buyers given the direct shipping route that saves time and lower costs, while also avoiding canal fees and delays, which suppliers from the US Gulf Coast must navigate.

Mexico Pacific was first initiated in 2017 and between 2022 and 2024 the project attracted offtake agreements for 14mn tonnes per year (tpy). Among the buyers secured were supermajors Shell and ExxonMobil along with energy giants ConocoPhillips and Woodside, as well as China’s Zhejiang Energy. The company’s offtake agreements secured nearly reach its 15mn tpy production capacity.

However, the project has struggled with rising construction costs that have plagued North America’s LNG industry broadly, with facilities on the US Gulf Coast and projects under construction in Canada having also dealt with rising construction costs.

Additionally, trade relations between the US and Mexico have soured since Donald Trump returned to the White House. Mexico relies heavily on the US for gas imports and worries are emerging that tariffs could be applied on gas moving from the US to Mexico, as Trump seeks to capitalize on Mexico’s City dependence on US Gas.

The Saguaro Energia facility will source its feed gas from the US Permian Basin, with gas transported to the export terminal via a 253-km pipeline in the US and then an 800-km pipeline in Mexico.