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Mexico Infrastructure Investments Hit All-Time Highs

01 June, 2014

The list of infrastructure projects and sources of new investment dollars that are pouring into this growing sector of Mexico’s economy continues to expand,as plans are made to upgrade the nation’s water,gas,wind,roadways and communication technology.

“With bigger and better infrastructure,there are more opportunities to attract productive investment,generate jobs and improve families’ income,” shared Mexican President Enrique Peña Nieto according to the Wall Street Journal.

The president raised his goal for infrastructure spending between now and 2018 to $587 billion last week,which is nearly twice the previous goal,which was announced last July. The new target is designed to boost growth in Mexico,which is already Latin America’s second largest economy.

In addition,the Mexican environment ministry,or SEMARNAT,has announced it will invest at least $30 billion over the next five years in new water infrastructure projects,which is more than double the total amount of new investments this sector has seen over the previous five years.

The projects will include providing new infrastructure for potable water,drainage and sanitation,as well as modernization of irrigation and agricultural water infrastructure. Finally,there will be new infrastructure put into place that will protect against natural disasters. Specifically,the island of Cozumel in the Mexican Caribbean will receive a new desalination plant,while the Riviera Nayarit and Baja California peninsula will receive new irrigation canals. 

Also of note,more than $650 million has been secured to finance a new wind farm project in the state of Nuevo Leon. Spanish renewable energy firm Acciona has been awarded the 20-year contract to build and operate the new wind farms,which will boast a total installed capacity of 252 megawatts and are expected to be fully operational by mid-2016. Investors include Cemex,Blackstone,Fisterra Energy and a variety of private groups.

“We are very pleased to close this important project as we have leveraged the use of our knowledge to continue our industry-leading expertise in the use of clean energy and alternative fuels,” shared Luis Farías,who serves as vice president of energy and sustainability at Cemex. “We will continue to look for other potential opportunities in the sector.”

The new wind farms will supply renewable energy to a variety of facilities,including those belonging to FEMSA,Cemex,Tecnológico de Monterrey and others,as supported by the Mexican Energy Regulatory Commission’s new self-supply initiative.

Finally,Petroleos Mexicanos,or Pemex,has allocated at least $1.4 billion to add the necessary new infrastructure to move gas from the Gulf to Mexico’s Pacific Coast. The plan will increase the amount of gasoline and natural gas transported between the regions.

“The strategy will enable fuel exports to the Far East,capitalizing on the existing price gap between North America and markets in Asia,” stated Pemex according to the Global Post. “Mexico’s geographical location makes it ideal for connecting the Gulf and Pacific coasts and reducing times and costs significantly.”

Mexico already has oil industry infrastructure in place throughout both regions. The additional infrastructure will include new pipelines to transport natural gas,propane and naphtha,along with new storage and transport facilities.

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