September 9, 2015 – Wall Street Journal
Energy Pipeline Boom Ebbs
By: Alison Sider
Falling U.S. oil production and low crude prices are casting a shadow over one of the bigger energy-infrastructure building sprees: pipeline construction.
The shale boom that began in 2008 created a huge need for new pipelines in places like North Dakota and West Texas—but many of those lines now have been built. Meanwhile, oil output has finally started to decline, according to federal estimates, in the wake of a 50% drop in the price of crude.
Read the full story here: http://www.wsj.com/articles/energy-pipeline-boom-ebbs-1441791001
A year ago, oil pouring from wells in the Permian often got stuck there because so little space was available on pipelines. But in the past year alone, pipelines capable of carrying an additional 750,000 barrels of oil a day to refiners on the Gulf Coast have come online.
“There’s not enough crude to fill the pipelines,” said Sandy Fielden, an analyst with consultants RBN Energy LLC.
That doesn’t necessarily mean projects already on the drawing board will be canceled, especially those that are backed by contracts that will allow developers to recoup their investments no matter what. But enough pipelines have been built or are in the works to connect all the large new shale formations to energy markets.
