Coauthored with Hana Heineken (ClientEarth Americas)
Saguaro Energía Liquefied Natural Gas (Saguaro LNG) export terminal—led by Mexico Pacific Limited LLC (Mexico Pacific)—is a high-risk, high-emissions project advised by Mitsubishi UFJ Financial Group (MUFG). Introducing a $15 billion megaproject in the Gulf of California, one of the world’s most ecologically rich marine ecosystems and home to a UNESCO World Heritage site, would undermine conservation efforts, violate international biodiversity commitments, and damage MUFG’s credibility as a signatory to environmental and social finance standards.
NRDC and ClientEarth urge MUFG investors to engage the company and call for robust environmental and financial due diligence, transparency around community risks, and a clear re-evaluation of MUFG’s role in Saguaro LNG.
Biodiversity impact: UNESCO World Heritage site at risk
The proposed Saguaro LNG terminal is slated for development along the Gulf of California coastline that supports endangered whales, dolphins, and sea turtles as well as critically endangered vaquita porpoises. Increased tanker traffic, dredging, underwater noise, light pollution, and spill risk threaten irreversible harm to marine biodiversity. These biodiversity risks directly conflict with MUFG’s public commitments to protect natural capital and avoid financing projects that negatively impact UNESCO World Heritage sites.
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Legal risks
In Mexico, the Saguaro LNG project is facing at least 10 legal challenges from environmental organizations and local community members. Additionally, in the United States, Mexico Pacific’s authorization to export LNG has faced ongoing regulatory hurdles from the U.S. Department of Energy. These lawsuits and permitting challenges have introduced uncertainty into the project timeline and could lead to significant delays in the construction of both the LNG export terminal and its associated Sierra Madre pipeline.
Stranded asset risk is exacerbated by delayed FID and worsening commercial prospects
Saguaro LNG carries a high risk of becoming a stranded asset—a capital-intensive investment that may face premature devaluation or impairment before the end of its economic life—as Mexico Pacific is still unable to reach a final investment decision (FID). The global LNG sector has experienced dangerous price swings due to geopolitical tensions and supply chain disruptions, raising concerns about overreliance on gas imports. These trends heighten the risk that Saguaro LNG could become underutilized or economically obsolete well before the end of its expected 20-year operating life.
Global environmental, social, and governance (ESG) trends impacting MUFG
Saguaro LNG is fundamentally incompatible with global climate goals. It would further fossil fuel lock-in and likely exacerbate methane emissions. MUFG has committed to aligning its financing activities with net zero emissions by 2050 and to managing environmental and social risks under frameworks such as the Equator Principles. Redirecting capital toward sustainable energy investments would better align MUFG’s portfolio with long‑term value creation, biodiversity protection, and the global clean energy transition.
Read the full issue brief
Call to action: MUFG and its investors have both legal and ethical obligations to manage material environmental, social, and governance (ESG) risks
The Saguaro LNG project poses risks that are not just reputational but financial and structural in nature.
We urge MUFG shareholders to back the following actions by MUFG:
- Request both a full environmental impact assessment for the liquefaction project and complete transparency from Mexico Pacific regarding offtake contracts, environmental approvals, legal risks, ownership and governance, and community and Indigenous Peoples’ consultation processes.
- Engage directly with affected Indigenous and community groups as well as marine biologists to understand impacts on the ground and in the marine environment.
- Without breaching any legal or contractual obligations, decline any financing, underwriting, or advisory services for Mexico Pacific until all environmental, financial, legal, and community concerns raised in this brief are fully addressed and mitigated.
- Implement exclusion screening for new LNG export infrastructure, including pipelines, as part of net zero policies by MUFG.
- Shift capital toward renewables and clean energy infrastructure opportunities in Mexico and elsewhere in Latin America, where alignment with ESG goals and the energy transition is significantly higher.
Our seas aren’t gas stations
U.S. energy company Mexico Pacific has been trying to turn a marine sanctuary—home to nearly 40 percent of all marine mammal species—into a gas station and shipping channel for liquefied natural gas. Tell Mexico Pacific to reverse its plans to export dirty energy out of the Gulf of California.
Related Resources
A Snorkeler’s-Eye View of the Gulf of California
Wrong Technology, Wrong Waters
