Fire at Mexico Pemex gas facility kills 26

REYNOSA, Mexico Wed Sep 19, 2012 12:48am EDT

1 of 2. Burnt cars and gas storage tanks are seen at a gas facility of Pemex in Reynosa, September 18, 2012.

Credit: Reuters/Daniel Becerril

REYNOSA, Mexico (Reuters) - An explosion and fire killed at least 26 people at a Pemex natural gas facility in northern Mexico near the U.S. border on Tuesday, one of the deadliest accidents in the oil and gas industry in recent years.

Television footage showed flames leaping high into the sky during the blaze at a gas compression station near the city of Reynosa, a key entry point for natural gas to Mexico from the United States.

It was the third blaze in about five weeks at state-run oil monopoly Pemex installations in Tamaulipas, a border state that has struggled to contain the menace of warring drug gangs. Pemex's top executive said the fire appeared to be an accident.

Parts of the plant were reduced to a mangled wreckage of twisted, charred tubing, the earth beneath scorched black. Soldiers stood guard with assault rifles at the entrance.

Victor Barrera, a local subcontractor at the plant, said he was only about 30 meters (100 feet) away when a pipeline exploded.

"A friend just told me around 40 people who were working on the tank were burned when there was a sudden explosion. I didn't even have time to turn around, what I did was run to save myself," said Barrera.

Pemex said gas imports from the United States were not affected, as the station stores gas from Mexico's Burgos field, and is not an import terminal.

The cause of the fire was unclear. Pemex said it was still investigating after fire fighters brought it under control on Tuesday afternoon.

"There is no evidence that the explosion was provoked, but rather that it was an accident," Pemex CEO Juan Jose Suarez Coppel told reporters after touring the site.

Illegal tapping of pipelines, often by criminal gangs, has cost Mexico hundreds of millions of dollars and sparked other major fires in the past.

Four of those killed on Tuesday were Pemex staff, and the other 22 were contract workers, the company said. Seven workers were still missing, while 28 people were hospitalized, two in serious condition, Pemex said.

The fire disrupted gas distribution in the area after Pemex turned off the pipeline, and local deliveries could be put under more serious strain if the shutdown is prolonged.

Tamaulipas has been a major battleground for drug cartels seeking to control smuggling routes into the United States, and gangs have repeatedly sought to siphon off fuel from pipelines.

Local resident Sofia Pacheco said there were rumors criminals may have caused the blaze, and she was doubtful the truth would come out.

"How are we going to know what really happened?" she said.

Pemex has suffered frequent accidents over the years.

In 1984, hundreds of people died and many more were burned after a series of explosions at a Pemex liquid petroleum gas facility in San Juanico, on the edge of Mexico City.

SYMBOL OF INDEPENDENCE

The latest incident is likely to increase pressure to improve security and transparency at Pemex, a symbol of Mexican self-sufficiency since the oil industry was nationalized in 1938.

Attempts to reform the company, whose revenues fund around a third of the federal government's budget and whose union has major political clout, have been difficult.

President-elect Enrique Pena Nieto, who takes office in December, has pledged to break with tradition and open Pemex to more private investment, but he faces a stiff challenge in Congress to achieve this.

Pemex said the blaze had caused damage to the measuring equipment, a pipeline and several control valves at the plant, which belongs to its exploration and production arm, PEP.

David Shields, an independent Mexico City-based oil analyst, said supply to Mexico's domestic market was unlikely to be significantly affected by a temporary closure.

"If Monterrey can be supplied from one pipeline, it can be supplied from another," said Shields.

Earlier this month, four Pemex workers were injured after a fire broke out at the Madero refinery in Tamaulipas. Another blaze at the same refinery occurred on August 13.

The accident on Tuesday was the second big gas-related blaze to hit Latin America in the past month.

Forty-two people were killed when a gas leak led to an explosion at Venezuela's biggest refinery on August 25. Authorities are still investigating the cause of that leak.

(Reporting by Adriana Barrera, David Alire Garcia and Lizbeth Diaz; Editing by Kieran Murray, Michael Perry and Lisa Shumaker)

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