New Bill Blocks US Natural Gas Exports That Rely on Foreign LNG Terminals, Citing Mexican Corruption

This bill is straightforward: it stops U.S. companies from exporting natural gas produced or refined here if that gas is headed to another country for the express purpose of being shipped out again from a foreign Liquefied Natural Gas (LNG) terminal. Essentially, if you’re trying to use an overseas LNG facility as a middleman to re-export our gas, this bill, under Section 2, says ‘no.’

The National Security Rationale: Why Mexico?

So, why the sudden restriction on a specific export route? The bill’s findings (Section 1) spend a lot of time laying out a case against Mexico, arguing that our southern neighbor is too corrupt and unstable to be a reliable partner for this kind of critical energy infrastructure. Congress points to Mexico’s low ranking on global corruption indexes and notes that massive fuel theft is a major problem, with reports suggesting illegal fuel stations significantly outnumber legal ones. They even mention that employees of Pemex, Mexico’s state oil company, have faced threats from cartels trying to get pipeline information.

This isn't just about crime; it's about the rule of law. The bill highlights recent changes in Mexico that could politicize the judiciary, making U.S. companies nervous about whether their contracts will be honored. Furthermore, Congress argues that Mexico is already violating the terms of the U.S.-Mexico-Canada Agreement (USMCA) by favoring its state-owned energy companies over private investors from the U.S. and Canada. The logic here is that if Mexico can’t guarantee stability, fairness, or security, we shouldn’t be using their territory to move our gas.

What This Means for the Energy Supply Chain

For the average person, this bill doesn't change the price at the pump tomorrow, but it does signal a major shift in energy trade policy. If you’re an executive at a U.S. energy company that has invested heavily in infrastructure designed to move gas through Mexico for re-export to global markets, this bill is a massive headache. It instantly cuts off a planned commercial route, forcing companies to find domestic buyers or use different, potentially more expensive, direct export channels.

The restriction is highly specific: it targets the use of foreign LNG terminals as re-export hubs for U.S.-sourced gas. This means the bill could act as a lever, pressuring Mexico to clean up its act and adhere to USMCA rules, using energy trade as the bargaining chip. On the flip side, it introduces economic uncertainty for the U.S. companies that have built their business model around these specific international arrangements. It’s a classic example of using trade restriction—in this case, energy export control—as a foreign policy tool, backed by national security claims, but with a direct cost to those businesses caught in the middle.