Industrial Info Sees More Natural Gas than Crude Pipeline Projects in Past 12 Months

Researched by Industrial Info Resources (Sugar Land, Texas)--In a price environment where crude oil is still hovering around $50 per barrel on a good day, it comes as no surprise that crude, condensate and bitumen pipeline projects are in short supply. With production declining or stagnating across multiple plays, the economics for new pipelines are just not there. Natural gas, by contrast, has existed in a price-depressed environment for over six years now, and judging by the level of activity, the industry has adapted spectacularly. While Industrial Info has added just shy of $16 billion across 29 new crude oil pipeline projects in the past 12 months ($14 billion of which is made up by a Canadian mega project), it has added over $8.1 billion across over 280 new natural gas pipeline projects in North America. Suffice to say, with the exception of the one outlier Canadian mega project, activity on natural gas pipeline infrastructure is greatly outpacing that of crude oil.

The Canadian mega project in question is the 1 million barrels-per-day (MM BBL/d) Eagle Spirit pipeline project by Eagle Spirit Energy Holdings (Vancouver, British Columbia). The pipeline has been touted as an alternative to the Northern Gateway pipeline project by Enbridge Incorporated (NYSE:ENB) (Calgary, Alberta) to carry Alberta oil sands crude oil to the coast of British Columbia for export. Aside from this project, crude oil growth is following the general trend of crude oil pipeline projects that are currently active and consists primarily of intra-regional connectivity projects. These projects are most concentrated in the young Bakken shale play in North Dakota and the high-producing Permian Basin play in West Texas. The lion's share of projects and spending are expected to begin construction between second and fourth quarter 2017, but there is a spike of activity starting in September 2016. Most crude oil projects are currently in early planning or permitting stages.

Natural gas pipeline projects, however, are looking at a steady number of construction kick-offs between August 2016 and June 2017 with at least one new project kicking off each month during that interval. Of the over 280 projects being tracked by Industrial Info, 44 are maintenance or op-ex spending, while the remainder are capital projects. More than half of the total number of projects are currently engaged in permitting activities at the federal, state and/or local level(s), while a little under one-fifth of the total number of projects are in early planning stages. As such, while the number of projects and spending may be high, with so many still waiting on eventual permits or designs, there is the risk that a large number of these projects may be pushed out or outright canceled.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.