Pemex LPG line catches fire near Guadalajara after backhoe punctures pipe


MEXICO CITY -- Mexico's state-owned oil company Petroleos Mexicanos, or Pemex, said a pipeline carrying liquefied petroleum gas was punctured by a privately operated backhoe near the central city of Guadalajara, and that the resulting fire was under control by midday Friday.

Pemex said in a series of messages on its Twitter page that two people were injured in the fire that erupted late Thursday - a highway worker and a firefighter. Gas supplies to Guadalajara were affected, the company added, but inventories will allow normal LPG deliveries to customers.

"The only distribution terminal affected is Guadalajara's, but it has sufficient fuel inventories to guarantee supplies to the region," Pemex said.

The company said that the fire was burning off the remaining gas in the air, and that once the blaze is completely extinguished, repairs would begin on the 14-inch pipeline, which runs from the Cactus processing station in the Gulf Coast state of Tabasco to Guadalajara.

Authorities closed an affected section of the highway that runs from Mexico City to Guadalajara as a precaution, and Pemex said it estimated the highway section would be reopened on Saturday. Also, people living near the affected part of the pipeline were evacuated.

LPG is used widely in Mexican households for cooking and heating water, and costly imports are subsidized by the government. Pemex imported about 77,000 bpd of the fuel on average in the first eight months of this year. It produced an average of 180,000 bpd of the fuel over the same time period.

LPG is delivered in small tanks, or pumped into stationary tanks outside homes. A few parts of the country, mostly in the north, have installed natural-gas pipelines to provide domestic gas service.

In mid-September, a massive explosion at a Pemex natural-gas processing center near the northern border city of Reynosa killed 30 workers and took about 800 million cubic feet of the gas offline at a time when the oil monopoly was already struggling to meet industries' demands for more of the fuel given its low price.

Pemex said it would try to keep up with natural-gas demand by increasing imports from the US to the maximum level that pipelines in Mexico could handle, and perhaps by importing more expensive liquefied natural gas that arrives on ships and is re-gasified at specialized plants.

While Pemex is a major exporter of crude oil, it is a net importer of natural gas and has been producing less of the fuel over the last couple of years and importing more. In August, natural-gas imports averaged a near-record 1.2 billion cubic feet/day compared with about 700 million cubic feet/day in August 2011.

Pemex's natural-gas production in the first eight months of this year averaged 6.42 billion cubic feet/day, compared with 6.59 billion cubic feet/day in the same period of 2011, according to Pemex data.

Dow Jones Newswires

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