Several US and European majors inked new deals towards end-2003 in the race to import LNG volumes into gas-hungry North America.

Anglo-Dutch Shell and US Sempra have teamed up in Mexico, US major ConocoPhillips has given a major boost to a Texas project, and UK based BG, already leading LNG importer to the US, has snapped up more capacity. Fellow UK major BP, meantime, earlier lined up a deal to supply Sempra with LNG from Indonesia's Tangguh project.

And US major ExxonMobil is eyeng a US east coast LNG import project, while moving ahead with plans in Texas and offshore Louisiana but rethinking in Alabama. The moves come as the US government's Energy Information Administration (EIA) has more than doubled its forecast of US LNG imports by 2025 to nearly 5-trillion cu ft.

On the Mexican front, Shell International Gas and Sempra Energy announced a joint venture to merge their LNG projects in the contest to build the first LNG import facility in Baja California. They said they would share investment costs of the $600m terminal equally and each take 50% of capacity.

Mexican Energy Regulatory Commission (CRE) officials have long argued the market in Baja California itself and across the border in the southwestern US is big enough for only one of at least four projects announced for the peninsula.

Mexico has rapidly growing demand for gas, but the mainland has no energy connections with Baja California. Marathon Oil has announced plans for a terminal that would form part of a "regional energy park," including a 1,000MW power plant, at La Joya outside Tijuana.

ChevronTexaco has its eye on an offshore terminal. But neither would be able to compete with the Shell-Sempra project, according to Sergio Rosado, Mexico analyst of the IPD Latin America consultancy.

The joint venture had a double advantage, he argued: Shell was the world's leading LNG shipper and Sempra a top player in gas and electricity markets on both sides of the border.

George Baker of Houston-based Baker & Associates was less certain. "This certainly puts Shell and Sempra into a strong position, but there are political factors involved as well, and it's not yet clear how they're going to play out."

Announcing the deal just before Christmas, the companies said their JV would build, own and operate a terminal at Costa Azul, some 14 miles north of Ensenada, able to supply 1-bil cu ft/d of gas both locally and in the US southwest.

About 500-mil cu ft/d would be used to meet growing demand in western Mexico, with any surplus providing new supplies for the southwest US. Construction is due to start by mid-2004, with the terminal going on-stream in 2007.

The partners said combining their proposed terminals into a single project would significantly cut the impact on the local environment. Shell and Sempra have long track records in Mexico.

Shell already has a 75% stake in a joint venture with France's Total to build an LNG terminal at Altamira on the Gulf Coast for supply to power plants of state owned Federal Electricity Commission (CFE).

Sempra has gas distribution concessions and pipelines in Baja California, as well as a power plant built to export electricity to the US. It is also developing an LNG reception terminal - Cameron LNG - near Lake Charles, Louisiana in the US.

In this region, ConocoPhillips gave a proposed LNG reception terminal at Freeport, Texas a major boost just ahead of Christmas when it said it would acquire 1-bil cu ft/d of regasification capacity there. With this deal, the Freeport LNG project at Quintana Island, Texas, was now fully subscribed, said developer Cheniere Energy. In June, Houston-based Cheniere announced an agreement with Dow Chemical for rights to 500-mil cu ft/d of capacity starting 2007; that deal is expected to be finalized this quarter.

Under the arrangement with ConocoPhillips, the major would obtain a 50% interest in the general partner of Freeport LNG Development and provide construction funding estimated at $400-500-mil, said Cheniere.

The full version of this is story was published in Platts International Report.