Released March 18, 2025 | SUGAR LAND
en
Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)--Ten significant natural gas pipeline projects were put into service last year in the United States, according to the U.S. Energy Information Administration (EIA). Five connected producing areas to demand centers in the mid-Atlantic and along the U.S. Gulf Coast, and five connected gas supplies to liquefied natural gas (LNG) terminals in Texas or Louisiana. Some were new (such as the Matterhorn from the Permian Basin to Katy, Texas) and others were expansions of existing lines. Here is a summary of both lists.
New takeaway capacity is always welcomed by producers across all basins, but particularly in the Permian Basin of Texas. That's where supply overload at the region's Waha hub caused natural gas prices to go negative or be barely in the black for long stretches last summer, noted IIR Energy Market Strategist Geoffrey S. Lakings. "Last summer Henry Hub prices averaged around $3 per MMBtu (million British thermal units), while S&P Global reports that Waha hub bottomed at minus $7 per MMBtu, and stayed below zero for almost as long as the mercury in an Arctic winter," he said. So Permian producers missed out on some otherwise very good prices. At least there, natural gas is a byproduct of the main event, crude oil.
Lakings also said that, as the EIA expects dry natural gas production to increase from 2024's 103 million British thermal units per day (MMBtu/d) to 107 MMBtu/d in 2026, pipeline backlogs could arise elsewhere if no new lines are built. He said he is especially concerned about the Appalachian Basin, because the "opening of the Mountain Valley Pipeline only came about through extreme agony on the part of its promoters, and a repeat performance is not likely--so that may be the last new capacity we ever see in that region."
Other basins are also looking to grow production. "We have Citadel--a hedge fund--acquiring operator(s) in the Haynesville where we will expect some ramp-up in molecule production, and we expect the same in Oklahoma's SCOOP/STACK/Anadarko," Lakings said.
Lakings continued, "Just think: Here we are at in 2025 with 16 Bcf/d of LNG feed gas going to terminals, and we are expecting to need more than 24 Bcf/d by 2028. How can we get all that gas from point A to point B, and at a reasonable cost?"
Indeed, should both production and demand (power plants, LNG, data center off-grid agreements) increase as predicted, the same delivery restrictions that could crush profits for Appalachian drillers would explode prices for buyers. "That is indeed a conundrum, both for those bringing the molecules up from the ground and for consumers using them to keep the home fires burning," Lakings said.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
- The Mountain Valley Pipeline, operated by Equitrans Midstream (NYSE:ETRN) (Pittsburgh, Pennsylvania), can move up to 2 billion cubic feet per day (Bcf/d) of Appalachian Basin production from Wetzel, West Virginia, to an interconnect with the Transcontinental Gas Pipe Line Company (Transco) in Pittsylvania, Virginia. For more information, see May 29, 2024, article - Gas at Last: Long-Awaited Mountain Valley Pipeline Lurches Toward June Opening.
- Transco's Regional Energy Access project, with the capacity of a little more than 0.8 Bcf/d, was an expansion of existing Transco infrastructure between Luzerne County, Pennsylvania, and Middlesex County, New Jersey. For more information, see August 12, 2024, article - Williams Companies Upbeat on Growth as Gas Demand Skyrockets.
- DT Midstream Incorporated's (NYSE:DTM) (Detroit, Michigan)Louisiana Energy Access Project (LEAP) Phase 3 project expanded the existing LEAP pipeline by 0.2 Bcf/d. As of June 2024, LEAP can transport 1.9 Bcf/d of natural gas from the Haynesville region to Gulf Coast markets via interconnections with other pipelines at the Gillis Hub near Ragley, Louisiana.
- The Matterhorn Express Pipeline, operated by WhiteWater Midstream (Austin, Texas), can deliver up to 2.5 Bcf/d of natural gas from the Permian Basin to the Katy, Texas, area. For more information, see October 3, 2024, article - Matterhorn Express Pipeline Begins Moving Gas from Permian.
Click on the image at right for an IIR Energy chart showing Matterhorn deliveries to interstate pipelines.
- Pecan Pipeline Company's Verde Pipeline (Houston, Texas) can move up to 1.0 Bcf/d of producer EOG Resources' natural gas production from Webb County, Texas, in the Eagle Ford producing region to the Agua Dulce hub in southern Texas.
- The ADCC Pipeline, operated by WhiteWater Midstream, can move approximately 1.7 Bcf/d of natural gas to the Corpus Christi Stage 3 LNG project, co-located with the existing Corpus Christi LNG terminal, in South Texas. For more information, see July 16, 2024, article - New Artery Opens to Feed Corpus Christi LNG.
- TC Energy Corporation's (NYSE:TRP) (Calgary, Alberta) 1.5-Bcf/d Gillis Access project connects with other pipelines at the Gillis Hub and can transport natural gas from the Haynesville region to LNG export terminals along the Gulf Coast.
- Venture Global's (NYSE:VG) (Arlington, Virginia) Gator Express Pipeline, phases 1 and 2, consists of two pipeline segments that can deliver approximately 2.0 Bcf/d each of natural gas from pipeline interconnections to the Plaquemines LNG export terminal located about 20 miles south of New Orleans, Louisiana. For more information, see March 3, 2024, article - Newly Launched Plaquemines LNG Terminal Close to Peak Capacity.
- Texas Eastern Transmission's Venice Extension project can move up to 1.3 Bcf/d of natural gas to the Plaquemines LNG export terminal. For more information, see May 26, 2022, article - Enbridge to Supply More Natural Gas to Venture Global's LNG Export Project.
New takeaway capacity is always welcomed by producers across all basins, but particularly in the Permian Basin of Texas. That's where supply overload at the region's Waha hub caused natural gas prices to go negative or be barely in the black for long stretches last summer, noted IIR Energy Market Strategist Geoffrey S. Lakings. "Last summer Henry Hub prices averaged around $3 per MMBtu (million British thermal units), while S&P Global reports that Waha hub bottomed at minus $7 per MMBtu, and stayed below zero for almost as long as the mercury in an Arctic winter," he said. So Permian producers missed out on some otherwise very good prices. At least there, natural gas is a byproduct of the main event, crude oil.
Lakings also said that, as the EIA expects dry natural gas production to increase from 2024's 103 million British thermal units per day (MMBtu/d) to 107 MMBtu/d in 2026, pipeline backlogs could arise elsewhere if no new lines are built. He said he is especially concerned about the Appalachian Basin, because the "opening of the Mountain Valley Pipeline only came about through extreme agony on the part of its promoters, and a repeat performance is not likely--so that may be the last new capacity we ever see in that region."
Other basins are also looking to grow production. "We have Citadel--a hedge fund--acquiring operator(s) in the Haynesville where we will expect some ramp-up in molecule production, and we expect the same in Oklahoma's SCOOP/STACK/Anadarko," Lakings said.
Lakings continued, "Just think: Here we are at in 2025 with 16 Bcf/d of LNG feed gas going to terminals, and we are expecting to need more than 24 Bcf/d by 2028. How can we get all that gas from point A to point B, and at a reasonable cost?"
Indeed, should both production and demand (power plants, LNG, data center off-grid agreements) increase as predicted, the same delivery restrictions that could crush profits for Appalachian drillers would explode prices for buyers. "That is indeed a conundrum, both for those bringing the molecules up from the ground and for consumers using them to keep the home fires burning," Lakings said.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
