EIA Report Says Planned U.S. Pipelines Carry $28 Billion Price Tag

January 2009 Vol. 64 No. 1

Despite turmoil in the financial markets and oil prices that are the lowest since 2003, the U.S. natural gas industry appears likely to remain one of the stronger performers in the energy sector. Supporting this is the Energy Information Administration’s (EIA) report, Additions to Capacity on the U.S. Natural Gas Pipeline Network: 2007.

In fact, figures in the report indicate that approximately 200 projects, representing a potential 10,100 miles of new pipeline and 103 Bcf/d of capacity, already are being planned or have been approved by U.S. regulatory authorities. If all were actually completed, about 2% more pipeline miles would be added to the national pipeline grid and overall network capacity would increase by more than 38%. Current estimates for the cost of this effort total almost $28 billion.

The report states that development of a number of proposed new LNG import facilities along the coastline of the U.S., as well as some in Canada and Mexico, if realized, likely will continue to spark new pipeline proposals. Each of these facilities requires new natural gas pipeline laterals to transport vaporized LNG to interconnections with existing interstate and intrastate natural gas pipelines. A substantial amount of pipeline capacity additions over the next three years will also come from the intense development activity in the Rockies and the northeast Texas producing areas.

The report also examines new natural gas pipeline capacity added to the U.S. natural gas pipeline system during 2007 and the areas of the country where those additions were concentrated.

Editor’s Note: This is a shorter version of an article appearing in the January 2009 issue of Underground Construction. Information in this article was substantially excerpted from a study by Damien Gaul and James Tobin, Energy Information Administration, Washington, D.C. For a copy of the EIA report, visit www.eia.doe.gov.