North American, International Pipeline Construction Remains Strong

By Rita Tubb, Managing Editor | November 2009 Vol. 64 No. 11

Demand for natural gas both in North America and the rest of the world is helping fuel pipeline construction worldwide. This is reflected in Underground Construction’s latest worldwide survey figures that indicate 125,458 miles of oil and gas pipelines are under construction and planned. Of these, North American projects account for 40,382 miles of new and planned pipelines while new and planned pipelines in the international sector total 85,076 miles. Just how many of the proposed pipelines will actually be built is highly speculative as several unpredictable factors will drive final decisions.

North American construction

The Energy Information Administration’s Natural Gas Year In Review 2008 report notes that in 2008 at least 84 natural gas pipeline projects were completed in the Lower 48, adding close to 4,000 miles of natural gas pipelines and about 43.9 Bcf/d of new capacity to the national pipeline grid, at an estimated expenditure of $11.6 billion. These figures represent a three fold increase over 2007 when $4.2 billion was spent on laying 1,674 miles of new pipeline while adding 14.9 Bcf/d of new capacity to the network.
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According to the report, the scale of the natural gas pipeline projects completed in 2008 was also exceptional. The capacity addition for 15 of the projects exceeded 1 Bcf/d, the largest being 2.6 Bcf/d. The average added capacity per project overall was 522 MMcf/d compared with only 290 MMcf/d in 2007, which was the second largest construction year in the last 10 years.

The report notes that 65 of the projects involved expansion of the interstate natural gas pipeline network, representing 34.2 Bcf/d of new capacity. The remaining 19 projects improved capacity and transportation service on intrastate natural gas pipelines (9.9 Bcf/d). More than one third of the projects attempted to satisfy a growing need for additional natural gas pipeline capacity to support transportation of new natural gas production to regional markets, adding 16.3 Bcf/d of pipeline capacity overall. Such projects were concentrated in the expanding natural gas production areas of Wyoming, western Colorado and in the Barnett Shale formation of northeast Texas.