Sempra delays start of operations at Energía Costa Azul LNG

US energy company Sempra has delayed the start of commercial operations at its Energía Costa Azul liquefied natural gas project in Mexico from the summer of 2025 to the spring of 2026.

"We are disappointed with the change in schedule," Jeffrey Martin, Sempra’s chairman and CEO, said Tuesday on a conference call on the company's 2Q results. "We expect our projects to be built on time and on budget."

The delay will add another US$300 million to the cost of the project, which was initially estimated at around US$2 billion.

Construction is approximately 85% complete, but Sempra said its contractor had not been able to hire and retain enough skilled labor to finish the job on schedule.

Located in Baja California, Energia Costa Azul (ECA) will receive and liquefy natural gas from the US, mainly for export to LNG markets in Asia. Phase 1 of the project will have a capacity to produce 3.25Mt (million tonnes) per year of LNG.

ECA LNG phase 1 has 20-year sale and purchase agreements with TotalEnergies and Mitsui for the purchase of a combined 2.5Mt/y of LNG. Phase 2 could add an additional 12Mt/y of export capacity, if Sempra approves the expansion.

Sempra has also delayed the commissioning of its Cimarrón Wind project in Baja California from the end of 2025 to the first half of 2026.

The 320MW, US$550mn wind farm has a 20-year power purchase agreement with Silicon Valley Power to supply renewable energy to the city of Santa Clara, California.

Sempra's other LNG project on the west coast of Mexico, Vista Pacifico in Sinaloa state, is at an earlier stage of development and construction has not yet begun. 

Sempra is developing the project in partnership with state-owned utility CFE. Vista Pacifico will have export capacity of around 3.5Mt/y of LNG and will also supply gas to CFE's power plants.

The expansion and rerouting of the Guaymas-El Oro gas pipeline, a key source of supply to the project, will be completed in the second half of this year, Sempra said.

The two LNG projects in Mexico and the Cimarrón wind farm are being developed by the company's Sempra Infrastructure unit.