Mexico’s natural gas pipeline network got a huge boost when state power company Comisión Federal de Electricidad (CFE) and Esentia Energy Systems signed a memorandum of understanding (MOU) to jointly invest $300 million to expand the national grid.

The agreement was signed on June 20 and aims to optimize existing pipelines and include new natural gas delivery points to serve CFE power plants and communities, the Mexican state power firm said in a statement.

"The agreement will also allow both parties to put an end to various pre-existing legal disputes," the power firm added, which have plagued the company since 2019.

Esentia, formerly known as Fermaca, operates the Waha-to-Guadalajara or “Wahalajara” system,which transports gas from the Permian Basin to the industrial hub of Guadalajara. Stretching more than 1,200 miles, Wahalajara is the largest private interconnected gas system in Mexico. CFEnergía is the primary holder of firm transport capacity.