- Buyer's guide
Billions Needed To Meet Long-Term Natural Gas Infrastructure Supply, Demands
If the recession were slightly longer, the impacts would be the reverse. Natural gas consumption and prices would tend to be lower than projected. A severely prolonged recession could, however, be problematic. Unconventional production has a relatively high decline rate. Drilling programs need to be continued in order to maintain production. Natural gas infrastructure will still need to be built to accommodate the locational shift in natural gas supply sources even if total U.S. and Canadian natural gas consumption is level or even declining.
The report warns, however, that a severe recession could limit the capital available for upstream and midstream investments necessary for the natural gas value chain to respond efficiently to demand. The credit quality of pipeline shippers might be impaired, creating another potential hurdle to proceeding with future pipeline projects.
The report also points out that many issues loom, particularly uncertainties regarding the direction of energy and environmental policies, and whether those policies will promote or discourage natural gas use.
Editor’s Note: The complete study prepared for the INGAA Foundation by ICF International can be accessed at http://www.ingaa.org/cms/31/7306/7828.aspx
(1) Pipeline only, excluding compression.
(2) To provide clarity, a 24-inch diameter pipeline at a cost of $100,000 per inch-mile would cost $2,400,000 per mile.