Major cross-border pipelines are under construction or in early startup from coast to coast to import cheap gas from the U.S. while another spate of projects is underway to tie it all together within the country.

While all this is going on, gas demand is soaring in greater Mexico City and the crucial industrial corridor from there west to Guadalajara. In an unheralded report in last week’s “Natural Gas Weekly Update,” the Energy Information Administration (EIA) cites statistics from an IHS Markit report that LNG imports at Manzanillo increased by an average of 30% in 2ndQtr and 3rdQtr 2016 compared with the same quarters in 2015. In October 2016, Manzanillo LNG imports were up 62% YOY.

A chart accompanying the article, based on IHS Markit data, shows that the peak period for overall Mexico LNG imports was from roughly June 2013 through the end of 2014. During that period, imports averaged close to 1,000 MMcfd, split about evenly between Altamira on the Atlantic side (at Tampico) and Manzanillo on the Pacific side.

Starting in 2015, the chart shows Altamira volumes dropping sharply to 100 MMcfd or less, and overall volumes falling below 400 MMcfd in some months. Manzanillo’s role as the crucial gas supply backstop shows up in April 2016 when it imports 600 MMcfd, and Mexico’s total rises to 700 MMcfd. That is roughly the level of LNG import activity from April through October.

The reason Altamira volumes have fallen away to almost nothing is the first arrival of substantial pipeline gas imports from the U.S. But the biggest system, the 2.1 Bcfd 42-inch Los Ramones system from Agua Dulce, Texas, to Celaya, Guanajuato, is running way below capacity.

EIA reports: “The Los Ramones Phase II South pipeline, commissioned in July 2016, was expected to alleviate natural gas shortages in the Central region and gradually displace LNG imports at the Manzanillo terminal. However, since the start of partial service, Los Ramones Phase II South has reportedly experienced technical problems. Currently, both North and South segments of Phase II of Los Ramones pipeline operate at a capacity of 400 MMcfd, significantly below nameplate capacity of 1,430 MMcfd, according to Mexico’s Secretaria de Energia.”

Accordingly, the importance of Manzanillo LNG has risen in Mexico’s energy matrix as it fills the hole left by lower deliveries than expected from the completed Los Ramones system.

In addition, EIA offers a valuable glimpse at changing patterns of Mexico’s LNG imports. “The United States became the largest LNG exporter to Mexico in November and may continue to supply LNG to the Manzanillo terminal if natural gas shortages in the Central region persist.

“With the recently expanded Panama Canal, the voyage from Sabine Pass to Manzanillo terminal has been reduced from 27 days around Cape Horn to 10 days through the Canal. Historically, Manzanillo terminal has been primarily supplied by LNG exports from Peru. In 2016, since opening of the expanded Canal, Manzanillo has also received LNG shipments from Atlantic Basin suppliers,” the U.S., Trinidad and Algeria.