After a record run of negative pricing last spring and summer, the Permian Basin collectively cheered as WhiteWater’s Matterhorn Express pipeline began flowing last October, bringing much-needed takeaway capacity to the area. Cash prices at the Waha Hub rebounded and the basin had a relatively uneventful winter, but prices began dropping in early March and have once again traded below zero for most of the past few weeks. This has taken the market somewhat by surprise, as many expected the impact of Matterhorn’s startup to last more than a few months. Prices jumped back above zero on Wednesday and above $1/MMBtu on Thursday, but with major pipeline maintenance coming next week, any relief is likely to be short lived. In today’s RBN blog, we’ll look at what’s driving the recent run of negative pricing in the Permian Basin and what it means until additional infrastructure comes online next year.
Daily Energy Blog
Two factors — public concern about soaring utility bills and President Trump’s strong opposition to offshore wind — are forcing New England to rethink its once-ambitious plans for a renewables-heavy electric grid and reassess how to meet its power-generation needs in the late 2020s and early 2030s. One possibility would be to expand the region’s access to piped-in natural gas, but midstreamers’ previous efforts to add pipeline capacity were beaten back time and again. In today’s RBN blog, we discuss New England’s ongoing debate about what to do next.
Mexico’s LNG sector has seen notable advancements in the past year, including new export project announcements and strategic investments. But many of the proposed LNG projects require extensive pipeline buildouts — no easy task south of the border and perhaps the biggest impediment most of the export projects face. In today’s RBN blog, we’ll look at where things stand with Mexico’s LNG sector and the export projects under development.
Western Canada’s natural gas market never really seems to catch a break. Prices this winter have remained well below those across much of the rest of North America thanks to an all-too-common combination of insufficient pipeline export capacity from the region, bloated gas storage and robust supply growth. Even with forward price prospects for much of the rest of the continent looking buoyant, with more gas expected to head to expanding Gulf Coast LNG terminals and a storage-refill season that will be stronger than last year, price upside for Western Canada looks to be minimal at best and will be partly dependent on the rate of gas intake to LNG Canada, as we explain in today’s RBN blog.
President Trump’s flurry of executive orders upon returning to office included one titled “Unleashing Alaska’s Extraordinary Resource Potential,” which aims to see the realization of the long-dormant Alaska LNG project, a multibillion-dollar plan to bring natural gas several hundred miles from Alaska’s North Slope to Anchorage and Cook Inlet for eventual liquefaction and export. The president’s endorsement renewed interest in a project that has been on the drawing board for more than 30 years. In today’s RBN blog, we look at why there is renewed interest in the project, some of the hefty challenges it would need to overcome, and why many still see it as a long shot.
New England is determined to shift toward a greener electric grid, but the region’s plan to slash its current reliance on natural gas (and backup fuel oil — and sometimes coal) by ramping up offshore wind and solar (and backup batteries) has hit a seemingly immovable object. President Trump, a staunch opponent of offshore wind, on Day 1 of his second administration ordered a halt to new leases and permits and directed his Interior Secretary to review existing permits. As we’ll discuss in today’s RBN blog, those moves have left New England power planners scratching their heads, and may even resurrect the possibility of expanding natural gas pipeline capacity into the region.
The long-term contract has been the cornerstone of the global LNG industry since its inception. Such contracts between upstream LNG producers and downstream utility companies have provided buyers with security of supply over a protracted period while guaranteeing producers sufficient income to justify the investment in export facilities and shipping fleets. But times are changing, with significant LNG volumes under long-term contracts scheduled to expire by 2031. In today’s RBN blog, we look at the potential implications for LNG buyers and producers around the world, the options available to them, and how their choices may impact LNG commercial models.
A significant shift is underway within Mexico’s energy landscape, reflected by the development of large-scale oil and gas infrastructure projects in the country, particularly the Southeast Gateway and Sierra Madre gas pipelines that would move U.S.-sourced natural gas across Mexico. These projects — the first an undersea pipe in the Gulf of Mexico and the second a pipe across the country’s northern tier — would enhance Mexico’s gas transport capacity while supporting power generation and industrial development. Mexico, which is already heavily reliant on imports of U.S. gas, is forecast to see gas demand rise in the coming years as domestic production drops. In today’s RBN blog, we look at those two pipelines, their challenges, and how the potential for U.S. tariffs on Mexican imports might complicate the future of both projects.
Producers in the Haynesville Shale had anticipated that growth in LNG exports in 2024 would goose prices and propel the play’s role as a crucial source of LNG feedgas. Instead, lackluster demand, exacerbated by delays at the Golden Pass LNG project, contributed to lower-than-expected natural gas prices, which caused some producers to scale back drilling plans and trimmed Haynesville production from about 16 Bcf/d in the first half of 2023 to less than 14 Bcf/d by the end of 2024. So, what do they have planned for 2025? In today’s RBN blog, we’ll discuss the Haynesville’s promise and challenges and highlight what E&Ps there are planning.
Venture Global put U.S. LNG on center stage after going public on January 24. The company, now listed as VG on the New York Stock Exchange (NYSE), launched one of the largest initial public offerings (IPO) in U.S. energy history. The IPO shares were priced at $25 each, raising $1.75 billion but valuing the company at $60 billion, a significant drop from the company’s initial target of up to $110 billion. While Venture Global was able to capitalize on some truly fantastic timing, going public just as President Trump took office and lifted the export permit ban, the market remains cautious about LNG and the energy sector. While Trump will certainly smooth the path at least somewhat to new LNG buildout, lawsuits and regulatory hurdles won’t simply disappear overnight. In addition to the general regulatory uncertainty facing the industry, there is also the matter of Venture Global’s contentious relationship with its original customers: Shell, BP and others have brought arbitration cases against the company that have yet to be resolved. In today’s RBN blog, we take a closer look at Venture Global, its assets and what its IPO says about U.S. LNG.
Natural gas production in the Permian is still on a roll — increasing so fast that midstream infrastructure can barely keep up. But producers, marketers and shippers want more than new takeaway capacity. They also need to know that the pipeline systems they sign up with can reliably move their gas to markets where they can get the best price. Put simply, they are demanding optionality. In today’s RBN blog, we discuss the optionality provided by a WhiteWater Midstream-led joint venture’s (JV) expanding gas pipeline network in Texas, including a brand-new project between the Agua Dulce and Katy gas hubs that’s in the works.
Russia’s invasion of Ukraine and Europe’s subsequent pivot away from Russian natural gas caused a huge resurgence in interest in U.S. LNG. That led to nearly 60 MMtpa (7.9 Bcf/d) of new U.S. LNG capacity reaching a final investment decision (FID) in 2022-23. But regulatory delays at the Federal Energy Regulatory Commission (FERC), the Biden administration’s pause on non-free-trade-agreement (non-FTA) export licenses, and legal challenges to the FERC approval process have essentially halted LNG development in the U.S. There are several LNG projects with enough commercial momentum to move forward that are stuck in regulatory or legal limbo, but even projects that have reached FID are not safe from legal challenges. In today’s RBN blog, we conclude our series on LNG delays by looking at recent court rulings and other regulatory issues and their impact on U.S. LNG development.
The pace of data center development accelerated in 2024, raising questions about how to power these energy-hungry behemoths. Natural-gas-fired plants are a go-to approach to helping local utilities provide the reliable, around-the-clock electricity that large-scale data centers need. Now, two giant oil and gas companies, ExxonMobil and Chevron, want to do something they’ve never done before: build gas-fired plants and sell power exclusively to data centers. And some utilities are partnering with big-tech companies on power plants of their own. In today’s RBN blog, we’ll discuss data center power needs and the unusual notion of building big gas plants to serve those customers.
Negative natural gas prices have been breaking hearts in the Permian Basin for many years, with pipeline development struggling to keep pace with rapid increases in associated gas production, but 2024 has shattered all previous records for the severity and length of negatively priced periods. The Matterhorn Express Pipeline, which started partial service at the beginning of October, is helping to stabilize the market for now, but with more production gains on the way, additional takeaway capacity will be needed. And after this year’s run of negative prices, producers have been willing to commit to new capacity.
The U.S. is now the world’s #1 supplier of LNG and the new liquefaction/export capacity slated to come online over the next few years suggest it will hold that position into the 2030s. To control more of the LNG value chain and become more familiar with the inner workings of the U.S. natural gas market, a small-but-growing number of LNG buyers and suppliers have been acquiring gas production assets close to LNG export terminals along the U.S. Gulf Coast — in other words, buying slices of the American gas-supply pie. In today’s RBN blog, we discuss the LNG market players pursuing this strategy, what they’ve been buying, and how their acquisitions may benefit them.
