From Houston Chronicle.  Link to follow a little copy.

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U.S. natural gas is flowing to Mexico at a record pace as demand for the fuel south of the border provides an outlet for surging supplies that have battered prices.

Exports by pipeline to Mexico, which can’t pump enough gas to meet local needs, reached 42.9 billion cubic feet in April as yields from shale formations drove U.S. output to an all-time high. Producers are shipping the fuel as prices at the Waha hub in west Texas, about 100 miles (161 kilometers) from Mexico, have dropped 65 percent from pre-recession levels in 2008.

Rising shipments to Mexico signal that U.S. gas exports may keep expanding as onshore production climbs, said Biliana Pehlivanova, an analyst at Barclays Capital in New York. U.S. regulators are weighing three proposals to build terminals to liquefy gas and send it to overseas buyers.

“We certainly have the production capabilities to export,” Pehlivanova said. “Output is growing at a pace higher than demand can absorb, even in this depressed price environment.”

Gas at the Waha hub declined 0.6 percent yesterday to $4.3469 per million British thermal units on the Intercontinental Exchange, down from $12.327 on June 24, 2008.

http://fuelfix.com/blog/2011/07/16/gas-glut-produces-record-u-s-exp...