Speaker Q&A Series – Guillermo Turrent Schnaas, CEO of CFEnergía and CFE International

With the Mexican Energy Series approaching, The Energy Dialogues team is running a Speaker Q&A Series to bring first-hand content from our speakers to our network.

We had the opportunity to speak with one of our featured experts on Midstream Day, Guillermo Turrent Schnaas, CEO of CFEnergía and CFE International, who will be speaking on regulation and competition in the Mexican natural gas market.

Q: Do you see any innovations on the horizon that are encouraging?

A: In general new types of contracts and interactions between the public and private sector. What CENAGAS is doing in their open seasons is starting to shape a competitive market. This needs to be continued and refined.

In terms of technology, a very important one is the electronic trading platform CFEnergía is developing. This platform will help make prices not only transparent, but also executable in real time.

Q: What do you think are the biggest issues in the Midstream sector today?

A:
1) Social problems mixed up with politics are impeding the conclusion of natural gas pipelines.
2) Inefficient and stressed infrastructure in the refined products sector: pipelines,
storage, ports, rail, etc.
3)  We have a tendency to liberalize and then not allow the market forces to show the very necessary market prices for infrastructure to be built.

Q: Are there any costs, risks or regional challenges that you think companies should be aware of?

A: I believe regulation is solid and the paths from A to Z are there. I do not see important risks in changes to the existing regulation. Regulators and agencies are evolving into solid institutions and I believe have caught up with the vast majority of the regulations of the energy reform.

Work needs to be done to try to standardize the indigenous consultations, but we all know how challenging this is. This is not a problem of México alone.

A really big problem in México is refined products theft from pipelines. This is a problem that needs to be eradicated. The authorities are working on it, but more needs to be done to eliminate this black market.

Q: With auctions coming up in March and July, what outcomes are you expecting to see?

A: There is definitely continued interest…

Q: Have you seen any trends in the storage market?

A: Regarding gas storage, CENAGAS and SENER and CNH are working together to establish a natural gas storage policy. In my opinion this is something that the market really needs on an operational basis. Having said that, one thing is operational storage, which can be achieved by the use of LNG storage tanks for example or line pack as gas pipelines come into operation, and a very different need is storage for geopolitical reasons.

Regarding liquids storage, it is evident that PEMEX storage is insufficient. On average México has the equivalent of 3 days of supply in inventories. Thus private companies have started to develop storage terminals. CFE is also participating. A big task pending here is the opening of the existing ports in order to make them open access.

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Join us at the Mexican Energy Series from April 17 to 19 in México City! The beauty of this event is that you can attend the Upstream, Midstream or Power & Electricity days—or all three days to reap the benefits of a full range of attendees. With multiple networking opportunities including roundtables, networking breakfasts and lunches, coffee breaks and cocktail receptions, the value-add from this Series is sure to yield real business opportunity. Visit energy-dialogues.com/mef/registration or contact us for more information: Bena Leslie b.leslie@energy-dialogues.com