Mexico bans fuel transloading operations: Clarification

Clarifies scope of transloading limits.

Fuel imported into Mexico through locations other than a standard customs point must move by pipeline or go into tanks rather than be transloaded between vessels, railcars and trucks, the customs agency (SAT) said.

Imported refined products, including blended ones, "cannot be translated directly to tank trucks or tankers, and this may only be done through pipelines or storage" outside of standard entry points, the SAT said in detailed rules published in the official gazette yesterday.

The ban applies for import sites known as a lugar distinto al autorizado (LDA), or a location different than a standard customs point. Mexican customs law allows imports in authorized government customs entry points, such as airports, international border crossing points and rail terminals. But if a company wants to import through a location other than these standard customs points, either because of the volume, size or frequency of the products it is importing, the company must ask for a permit to import at a different location. Transloading would not be allowed at these LDAs, under the new rules.

Mexico has a total of 49 standard customs points — 19 on the northern border, 17 ports (including Tuxpan and Dos Bocas), 11 in-land points and two on the southern border. Yet there is no registry of the number of LDAs, which are mainly private-sector import points.

The change was made as part of a recent easing of a decision to impose restrictions on private-sector fuel importers that would have prevented them from bringing in supply without the participation of state-owned Pemex or CFE. The government has previously said that the policy shifts are part of the government's strategy to fight rampant fuel theft, as transloading operations are harder to monitor and control.

But using transloaders to begin fuel imports at storage sites, especially in the interior of Mexico, while tank construction was completed had become a common practice.

The change will hurt companies that have not contracted fuel storage, energy lawyer Diego Campa said.

Mexico has a limited amount of fuel pipelines, the majority owned by Pemex.

More terminals closed

In addition to limits on private-sector storage terminals, the energy regulatory commission (CRE) over the weekend stopped operations at the 690,000 bl fuel storage terminal in Salinas Victoria, Nuevo Leon, that serves ExxonMobil and other brands, multiple sources told Argus.

The CRE also closed on 18 November a transloading terminal in Nuevo Leon used by Valero. Still being developed by Grupo Mexico, the terminal carries out mostly transloading operations, as the 425,000 bl of storage capacity will not be ready until 2023.

The main reason for the closures was that the terminals were using rail cars as storage units, one of the sources said.

The CRE has also recently shut a 650,000 bl storage terminal in Puebla and Monterra Energy's 2.2mn bl fuel storage terminal near the coastal import center of Tuxpan. Operators allegedly did not have proper documentation during an audit in September.