Gas is abundant, and gas pipeline companies are rapidly identifying and pursuing new investments to bring this resource to consumers throughout the United States. In the first quarter of 2012, a number of gas companies announced investment plans to build the gathering line infrastructure required to bring abundant shale gas and natural gas liquids to market. In some cases, gas infrastructure investments are being made to accommodate increased demand for gas-fired power generation. In other cases, utilities and transmission companies see new opportunities to harness increasing gas supplies from their neighborhood shale plays and transport them to consumers within and outside of their traditional service territory.
For example, ONEOK Partners announced last week that it will invest more than $140 million to construct a 270-mile natural gas gathering system going into the Bakken shale. The system will create new opportunities for Bakken and Three Forks producers to process and deliver natural gas to the marketplace. ONEOK will also spend more than $1.5 billion between 2011 and 2014 to support its natural gas and natural gas liquids businesses, including an additional 500-mile natural gas liquids pipeline. Last month, NiSource Gas Transmission & Storage announced similar plans for bringing gas to market from the Marcellus and Utica shales, two areas where shale deposits have created potentially vast new gas supplies for the northeastern United States. The company’s Pennsylvania Marcellus Pipeline project will invest about $145 million to bring 300,000 dekatherms per day of new capacity onto its system and connect to multiple interstate pipelines.
A number of companies have sought authorizations from the Federal Energy Regulatory Commission (FERC) to expand storage, processing, transportation, and trading hub facilities to interconnect with major interstate pipelines. Recently, FERC authorized Hope Gas Inc., a local gas distribution company, and Hinshaw to build new facilities to take gas from several producers in the Marcellus region for delivery to three major interstate systems. FERC’s approval anticipates that E&P activity in the West Virginia Marcellus will create enough supply in the next few years to outstrip demand on Hope’s LDC system and in West Virginia as a whole! We can expect FERC to remain active in reviewing such projects in 2012 and 2013.
To learn more about our country’s abundant natural gas resources, check out AGA’s most recent Energy Analysis report discussing findings on U.S. 2011 Natural Gas Reserves and a recent snapshot of natural gas trends going into 2012.