New NRDC Report: Saguaro LNG Is a Dangerous Bet for J.P. Morgan Chase Investors
WASHINGTON, D.C. — The proposed $15 billion Mexico Pacific Saguaro LNG export terminal is being marketed as a gateway for U.S. gas to Asian markets. In reality, a new analysis from NRDC (Natural Resources Defense Council) finds the project is a high-risk gamble that would saddle investors with stranded assets, destabilize communities, and irreparably damage one of the world’s most ecologically important marine ecosystems.
The following is a statement from Joel Reynolds, senior attorney at NRDC:
“Saguaro LNG is the wrong project in the wrong place at the wrong time. It combines volatile market fundamentals with spiraling costs, shaky contracts, and the wholesale industrialization of a UNESCO World Heritage Site. For J.P. Morgan and its shareholders, the choice is clear: Double down on yesterday’s fuels and risk long-term losses, or pivot to investments aligned with the clean energy future that is already unfolding.”
Background
The investor brief, High-Risk, High-Impact: Why J.P. Morgan Chase Investors Should Reconsider Mexico Pacific LLC’s Saguaro LNG Project, urges J.P. Morgan shareholders to press the bank to withdraw from the project and instead redirect capital toward lower-risk renewable energy investments in Mexico and Latin America.
- LNG oversupply: A surge of new global LNG capacity is colliding with weakening demand. China—Saguaro’s key target market—suspended imports of U.S. LNG in 2025, while Japan and South Korea are accelerating shifts to renewables and hydrogen, and Southeast Asia is canceling LNG-to-power projects. This growing imbalance threatens to flood the market and drive down prices, undercutting Saguaro’s viability.
- Stranded asset risk: The International Energy Agency projects global gas demand will peak before 2030, just as new supply from the U.S. and Qatar floods the market. Saguaro LNG could be obsolete before its investors see returns.
- Governance turmoil: Mexico Pacific has cycled through five ownership structures in five years, laid off staff, relocated its headquarters, and seen multiple CEOs depart. It has already requested a seven-year extension on its export permit.
- Legal challenges and pipeline: At least five lawsuits are already pending in Mexico, and construction of the Saguaro terminal has been stopped pursuant to court-ordered injunction. The 500-mile Sierra Madre pipeline, essential to feed gas to the terminal, faces litigation risk, community opposition, and security and economic risks tied to cartel-controlled regions.
- Biodiversity and climate impacts: The project site sits adjacent to the UNESCO-listed Gulf of California World Heritage Site, home to nearly 40 percent of the world’s marine mammal species. The terminal would emit 5.7 million metric tons of CO₂ annually, the equivalent of adding over a million cars to the road each year.
NRDC (Natural Resources Defense Council) is an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law and people power to confront the climate crisis, protect public health and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Beijing and Delhi (an office of NRDC India Pvt. Ltd).