On Jan. 29, the sky above Mexico City’s Zócalo plaza was filled with the floating figures of giant balloon whales. Hundreds of people from the “Whales or Gas?” coalition protested in front of the National Palace over the Saguaro energy project, a massive pipeline planned by the government with U.S. energy company Mexico Pacific that will move liquefied natural gas from Texas to the Gulf of California.

The organizers of the Ballena Fest (Festival of Whales) had gathered more than 200,000 signatures against Saguaro. They say the project, which includes plans for a major LNG processing and shipping complex in the small coastal fishing town of Puerto Libertad, will destroy habitats in protected inland areas, as well as threaten delicate marine habitats and marine mammals. They also say that Saguaro deepens Mexico’s reliance on U.S. fossil fuels and goes against President Claudia Sheinbaum’s promises to invest in the country’s energy transition.

The 30 million metric tons of LNG that the Saguaro project would move annually would have a greenhouse gas footprint of about 82.8 million metric tons of CO₂ equivalent, or the same as the yearly emissions of more than 19 million cars. Saguaro is also part of a broader controversy over a proposed energy reform bill that would lead to heavy investments in fossil fuel energy production and transport infrastructure in public-private partnerships with U.S. energy companies.

Mexico relies on natural gas for nearly half of its domestic energy consumption; in 2024, according to government statistics, 63% of grid electricity was generated from burningnatural gas, of which 70% came from the U.S. The latter is the world’s largest exporter of natural gas, and many U.S. companies are looking to expand their operations on Mexico’s Pacific coast, from where they can reach Asian markets much more quickly and cheaply by not having to go through the Panama Canal.

During her presidential campaign, Sheinbaum, who took office last October, promised to build on the energy reforms of her predecessor, Andrés Manuel López Obrador, better known as AMLO, who stressed that Mexico needed to become energy independent. Unlike AMLO, though, who invested heavily in fossil fuel projects and state-owned energy companies like oil and gas producer Pemex and electricity utility CFE, Sheinbaum talked about a “just energy transition” in the move from hydrocarbons to clean energy.

But her spending plans, which incentivize foreign investments in style=”font-weight: 400;”>public-private partnerships with state-owned companies, are currently overwhelmingly focused on natural gas and petroleum products. This has soured some of the environmentalists and renewable energy advocates who previously supported her campaign.

Fossil fuels don’t fit in a clean energy agenda

At roughly 800 kilometers (500 miles), the Saguaro pipeline will run overland from the Permian Basin in West Texas, across the Mexican border, through the states of Chihuahua and Sonora and arrive at the LNG processing plant at Puerto Libertad in the Gulf of California. From there, the fuel will be loaded into tankers sailing out to the Pacific. The megaproject has already acquired preliminary construction permits from the U.S. and Mexican governments, though it hasn’t yet obtained final approval.

Energy companies often pitch LNG as a “cleaner” fossil fuel that’s ideal for making the transition to renewables. “Gas is not a renewable resource,” says Miriam Macías Solis, director for Mexico and Latin America at the Mexican Center of Industrial Ecology (CMEI), “but it is much cleaner than burning coal.”

But burning LNG accounts for only 34% of its total greenhouse gas footprint, according to a 2024 study by researchers at Cornell University in the U.S. The majority of the GHG footprint associated with LNG comes from methane emissions in its extraction and transport, and the energy used to produce, liquefy and transport the fuel, the study found.

Yet these high sources of emissions, particularly methane, a far more portent greenhouse gas than CO2, are often not accounted for in industry reports on the carbon footprints of megaprojects like Saguaro.

Mexico is the world’s 13th-largest methane emitter and ranks third in Latin America, according to a 2024 analysis by the Wilson Center, a U.S.-based think tank. Throughout her presidential campaign, Sheinbaum often focused on the underreporting of GHG emissions in general as part of national energy production and called for reducing methane emissions from oil and gas.

“Claudia [Sheinbaum] often explained how methane is an amplifier for climate change,” says Claudia Campero , an activist and energy expert at  Conexiones Climáticas, an advocacy group that backs the Whales or Gas campaign. “One molecule of methane has 85 times the heating power of a molecule of carbon when released into the atmosphere,” she says. “Though it disperses more quickly, methane is a powerful engine for the ‘greenhouse effect,’ one which LNG projects often do not report on.”

“This [project] has nothing to do with Mexican energy independence,” says Jacqueline Valenzuela Meza, executive director of the Center for Renewable Energy and Environmental Quality (CERCA), which is also part of the Whales or Gas coalition. “This is merely increasing our dependence upon fossil fuels produced in the U.S. It is not ‘sustainable’ in an environmental sense, only economically.”

Any energy transition policy should at least be investing in renewable energy sources, rather than doubling down on fossil fuel infrastructure, she adds.

President Sheinbaum’s energy plan, currently winding its way through the legislature, promises to generate 6,000-9,000 megawatts of clean energy by 2030, with a focus on solar installations and public-private partnerships. The goal, according to government data, is to cut GHG emissions by 12.7% over the next 15 years.

Details on when those projects will begin, however, are scarce, according to Campero.

Some experts say President Sheinbaum’s apparent pivot on energy policy toward fossil fuel projects like Saguaro is simply a response to the energy and market realities in Mexico.

“This new bill is part of a counterreform process begun under AMLO in 2021. The goal is at least 54% energy production” by CFE, the state-owned utility, Macías Solis says. She adds the government’s primary goal is to regulate energy prices.

“Energy is a basic good,” she says, noting that in a country where most people earn far less than in the U.S. or Europe, “markets simply can’t absorb large price fluctuations … especially stratospheric increases.”

But Macías Solis also says that massive investments in domestic fossil fuel production have come with a high environmental cost that AMLO preferred to ignore. As president, he directed massive investments into Pemex’s oil infrastructure, tasking the company with domestic energy production at all costs, according to the Wilson Center report: “Sustainability and methane emission reductions were not on the state-owned company’s list of priorities.” Under the AMLO administration, the company gained a poor reputation for oil spills, fires in its gas infrastructure, and high emissions.

Activists warn of existential threat to Gulf of California ecosystems

The Gulf of California, also known as the Sea of Cortés, is a biodiversity hub that hosts more than 8,000 animal species, including one-third of the world’s whale and dolphin species and 85% of Mexico’s marine mammals. Parts of the gulf have protected status in the form of a UNESCO World Heritage Site, a UNESCO Biosphere Reserve and 10 Ramsar wetlands of international importance. The Mexican government has also designated 12 natural protected areas in the gulf.

This has prompted calls to cancel the Saguaro project over its potential environmental impacts, arising not just from the planned LNG plant, but also shipping and related industrialization, according to U.S.-based advocacy group the Natural Resources Defense Center (NRDC). The group to the CEO of Mexico Pacific in December 2024, calling for the pipeline project to be shut down. It also says the company’s 2024 ESG report fails to disclose or address the project’s environmental consequences on the gulf.

Activists say that aside from GHG emissions and allowing development in crucial protected areas, increased traffic for shipping LNG could result in more whale strikes and  ocean noise, threatening, among other species, the blue whale (Balaenoptera musculus), and disrupting the breeding and feeding of marine species.

In a March 2025 letter, U.S.-based NGO the Center for Biological Diversity called on UNESCO and the IUCN, the global wildlife conservation authority, to put pressure on Mexico to halt the Saguaro project and conduct an assessment of potential impacts on the protected areas affected.

President Sheinbaum’s silence on the environmental impacts of the megaproject has been a disappointment to environmental activists who said they had hoped her progressive government would place a premium on ecological concerns.

Campero says she’s concerned about every step in the chain of the Saguaro project. “The gas which will be imported comes from fracking operations [in the U.S.], which contaminate water, air and soil.” Methane leakage from extraction and transportation are an inevitable part of the production process.

At the other end of the planned pipeline, in Puerto Libertad, where fishing is the principal economic activity, residents have also opposed the project. They say they fear their livelihoods will be destroyed. “It leaves us nothing but death in Baja California Sur,” one local told Mexican media.

Although the Saguaro project’s proponents have touted thousands of new jobs that will boost local economies, the technical positions will likely go to workers from Mexico City or other countries, says CERCA’s Valenzuela Meza. “Local communities have to be integrated into energy projects,” she tells Mongabay, “both economically and in terms of decision-making.”

LNG is a risky bet

Global LNG infrastructure investment has greatly expanded in the past decade, with $1.1 trillion in terminals under construction as of 2024. This investment has been driven by increased energy demand in Asia, as well as European efforts to divest from Russian gas after the invasion of Ukraine in 2022.

Saguaro is one of hundreds of gas projects and infrastructure investments currently considered part of Mexico’s ambitious plans to become the fourth-largest gas exporter in the world. But in the long run, Mexico’s bet on LNG might be a losing one.

A 2024 report by the Institute for Energy Economics and Financial Analysis (IEEFA) suggests international gas markets might become saturated. Europe has increasingly invested in clean energy as part of efforts to begin moving away from natural gas entirely, and Japan and South Korea, which currently account for half of all global LNG imports, are investing heavily in domestic energy production.

Meanwhile, China, the world’s third largest gas exporter, has an inherent advantage in Asian markets, able to sell more cheaply to its neighbors because of lower transport costs, according to the IEEFA, a U.S.-based think tank.

“[Saguaro] isn’t part of any energy transition,” Campero says. “It is simply a scheme for the sale of an energy source that has a high value now, but whose long-term future is uncertain.”

In its letter last December to Mexico Pacific’s CEO, the NRDC also warned that Saguaro “risks locking Mexico into a decades-long bet on volatile LNG markets.”

Valenzuela Meza says President Sheinbaum should make good on her promises to make big investments in solar and wind. She says she worries, though, that those reforms seem, at least for now, to have been left on the campaign trail.

The Saguaro project is currently on hold due to injunctions imposed as a result of five lawsuits filed by environmental organizations in January. Preliminary construction of the pipeline can’t continue until the courts determine whether the lawsuits have legal merit. In addition, in response to pressure from activists and NGOs, Mexico’s environment ministry is reviewing environmental permits granted under the AMLO administration. Mexico Pacific hasn’t responded publicly to the developments, but has begun renegotiating future LNG prices with potential Mexican and international buyers, saying the legal delays are raising its long-term construction costs.

On its website, the company doesn’t list a date for the Saguaro project to go into operation.

Banner image: Activists protests against the Saguaro liquefied natural gas pipeline in Mexico City’s Zócalo plaza. Image by Mateo Palazuelos.

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