This year will be a tale of two halves for the prolific Permian Basin, which is so constrained when it comes to natural gas infrastructure that cash prices at the Waha Hub in West Texas have averaged just $0.06/MMBtu since the beginning of December, even including the higher prices during the freeze-offs caused by Winter Storm Fern. Production and pricing figure to remain fairly stable until the back half of this year, when 4.5 Bcf/d of new pipeline capacity comes online, giving the basin room to grow for the first time in a long time. In today’s RBN blog, we take a look at the Permian production outlook and the new infrastructure coming to allow for the promised supply growth.
The RBN NATGAS Haynesville is a weekly natural gas fundamentals analysis focused on supply, flow, and LNG-driven demand dynamics within the Haynesville basin.
The Permian Basin, which includes West Texas and southeastern New Mexico, is a prolific producer of natural gas but not a very large consumer. While some production is needed to meet local demand (gray layer in Figure 1 below), the majority of it needs to leave the basin (green layer). That means that a lot of pipeline capacity is needed to transport the gas to more demand-rich areas. The basin’s effective takeaway capacity (red line) is the sum of all the pipelines out of the area, with some caveats for gas flowing to Mexico and the West because of downstream constraints and ongoing pipeline issues. As the basin becomes more constrained (when the red line moves closer to the green area), the lower Waha prices move. The last time the Permian market was this constrained was in 2024. (Permian production and flows are tracked in RBN’s Arrow Model.)
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About the song
“Key to the Highway” was written by Charlie Segar and William “Big Bill” Broonzy. It appears as the third song on side two of Layla and Other Assorted Love Songs, by Derek and the Dominos. Eric Clapton and Duane Allman had heard Sam Samudio (Sam the Sham) playing the song in a studio adjacent to theirs at Criteria in Miami and were jamming on the song in the studio when producer Tom Dowd had the good sense to hit the “record button” during the jam, hence the fade-in at the start of the song. The original release of the song was by Little Walter and His Jukes, released as a single in September 1958. Many artists have covered it over the years. Eric Clapton has covered it on five of his albums. Personnel on the Derek and the Dominos record were: Eric Clapton (vocals, guitar), Bobby Whitlock (keyboards), Carl Radle (Bass), Jim Gordon (drums) and Duane Allman (slide guitar, guitar).
Layla and Other Assorted Love Songs was recorded between August and October 1970 at Criteria in Miami, with Tom Dowd producing. Dowd was instrumental in bringing Duane Allman in for the session. Clapton referred to Allman as “the musical brother I never had, but wished for.” The double album, fueled by the title song about Clapton’s infatuation with Pattie Boyd, was released in November 1970. It went to #16 on the Billboard 200 Albums chart and has been certified Gold by the Recording Industry Association of America. Two singles were released from the LP.
Derek and the Dominos were an English-American rock band formed in London in the spring of 1970 by Eric Clapton. Disillusioned after the breakup of Blind Faith, Clapton toured for a while with Bonnie and Delaney. He brought bassist Carl Radle, keyboardist/vocalist Bobby Whitlock and drummer Jim Gordon from the Delaney and Bonnie band to England to form the Dominos. Dave Mason was involved for a short while in the band. All of them played on George Harrison’s All Things Must Pass album. After playing a few shows in England, they traveled to Criteria studios in Miami to make their debut and only studio album. They released one studio album, two live albums and four singles. The band went their separate ways in the fall of 1971. Clapton went on to pursue his solo career, bringing Carl Radle with him. Bobby Whitlock became a solo artist, and Jim Gordon did session work. Carl Radle died in Claremore, OK, in May 1980 at 37. Jim Gordon died in prison at Vacaville, CA, in March 2023. Bobby Whitlock died in Ozona, TX, in August 2025 at 77
"About the Song" -- written by Mickey McMahan , RBN Director of Musicology
