Mexico considers increasing fracking in order to reduce its dependence on US gas.

The Financial Times reported that Mexico had been talking to private companies about increasing its reliance on U.S. natural gas in the face of increased trade tensions between both countries.

The imports of natural gas, almost exclusively from the United States (72%) are the main sources of Mexico's total consumption.

The FT reported that the discussions are still at a very preliminary stage. Four executives who were privy to the discussions said that the companies are interested in making investments.

RBN Energy is a market advisor service that wrote in a note recently that U.S. Imports have tripled over the last decade, with the majority coming from the Permian Basin and Eagle Ford Basin. Mexico's production has dropped rapidly, the report said, and that a large portion of its gas was considered unusable due to high nitrogen levels.

Mexico is already considering measures to double the strategic storage capacity of natural gas, due to fears that U.S. president Donald Trump may use Mexico's dependency on U.S.-produced gas as a form of leverage.

Natural gas is primarily used to produce electricity and in industrial applications. Pipelines carry the vast majority of Mexico's natural gas imports. Reporting by KanjyikGhosh from Bengaluru, Editing by Jamie Freed & Lincoln Feast

(source: Reuters)