Shale Growth Causing NatGas Pipeline Replumbing Says Braziel

(NGI's Shale Daily - April 11, 2013) Shale Growth Causing NatGas Pipeline Replumbing Says Braziel


The day-in and day-out reports from operators ready to build new natural gas pipelines and natural gas liquids (NGL) midstream infrastructure generally have had one thing in common over the past couple of years: most are for the Marcellus Shale. And that's not going to change anytime soon, according to industry executives.

Many of the biggest pipeline systems now carry gas to U.S. East Coast markets. That has to change, according to Rusty Braziel of RBN Energy LLC. He spoke Tuesday at the 92nd Annual Gas Processors Association Convention in San Antonio.

Marcellus gas supplies have grown from about 2 Bcf/d in 2005 and are tracking to hit 18 Bcf/d in 2017, he said. The increase in supplies from the Marcellus, and potentially from the Utica, will turn off gas imports from Canada and lead to more streams being reversed in the Lower 48 states.

"A lot of replumbing is going to be required" for pipelines and storage, Braziel told the packed audience. He elicited some laughter with a "suggestion" that some of the west-to-east pipes eventually could be turned into water slides.

Domestic gas production is at an all-time high, with 16.2 Bcf/d of incremental growth in the Lower 48 states in a little more than two years, he noted. However, the Marcellus Shale's output today eclipses any other producing U.S. basin and will change the maps for gas infrastructure.

Why? Up to now, the Northeast needed gas supplies. The big pipes run east. Trying to reverse what has been in place for years is going to take more years.

The inventory of drilled but nonproducing wells in northern Pennsylvania, which stood at just under 1,200 wells last May, "will take five years to clear," Braziel told the audience. There's just not enough infrastructure to process the gas or carry it to other markets.