Esentia Sees Data Centers in Mexico Fueling Demand for Pipelines

(Bloomberg) -- Mexico’s Esentia Energy Development expects a boom in data centers to bolster its pipeline business, as the country races to build out energy and AI infrastructure to compete with its regional peers. 

“There’s a lot of pent up demand” for new data centers and energy to power them, Chief Executive Officer Daniel Bustos said in an interview in Mexico City.

While Mexico is among Latin America’s fastest-growing markets for new data centers, the nation is trailing Brazil, Argentina and Chile on a per-capita basis, according to Bustos. To gain ground, the country, which faces near-constant droughts and an energy grid that’s vulnerable to seasonal rolling blackouts, has to improve its energy capacity, he said.

Esentia plans to use proceeds from a recent share sale and private placement to boost its capacity for transporting natural gas. The company currently operates a private-gas network that runs from Waha, Texas, to the center of Mexico. Eventually, the company will have to look at doubling the size of its system, Bustos said, without providing a timeline.

“There’s a gap on energy security that needs to be closed, and we believe we’re going to be one of the leaders in doing so,” he said.

The data-center industry in Mexico will likely attract more than $9.2 billion of new investments between 2024 and 2029, according to Prodensa, which helps foreign companies establish operations in the country. 

New data centers in Mexico will increasingly rely on imported gas, and that means demand for pipeline infrastructure will likely rise.

Currently, Mexico’s imports of US natural gas are at record highs, driven by the nation’s growing electric-power sector, according to the US Energy Information Administration. About 60% of Mexico’s energy grid runs on natural gas — and roughly 70% of that gas is imported from Texas.

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