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Southern Cross - Natural Gas Flows Into and Out of the Agua Dulce Area and What They Reveal

In just a few years’ time, the Agua Dulce Hub in South Texas has become an increasingly busy, complex and important crossroads for natural gas pipelines. Every day, more than 7.5 Bcf of gas flows through the hub’s inbound and outbound pipes, linking Permian and Eagle Ford supplies to gas demand centers along the Texas coast and in Mexico — LNG export terminals, power generators and industrial, commercial and residential customers. And if you think Agua Dulce is big now, just wait. In today’s RBN blog, we continue our in-depth look at Agua Dulce with an analysis of the growing gas volumes into and out of the hub, the pipelines handling those flows, and the key sources of incremental demand.

As we said in Part 1, before the big run-up in Permian and Eagle Ford production in the 2010s and early 2020s, many of the pipelines running to and/or through the Agua Dulce (pronounced agh-wuh DEWL-seh) area were the southernmost reaches of large, decades-old mega-systems like Williams’s Transco, Kinder Morgan’s (KM) Tennessee Gas Pipeline (TGP), Enbridge’s TETCO, and KM-operated NGPL, which for the most part moved Gulf Coast-sourced gas south to South Texas and (in much larger volumes) north to the U.S. Northeast and Midwest. (See Figure 1 below.) Their down-the-coast brethren included Boardwalk Pipelines’ Texas Intrastate Pipeline, Energy Transfer’s (ET) Houston Pipeline System (HPL), Enterprise Products Partners’ Texas Intrastate Pipeline, and KM’s Tejas Pipeline. Thanks to production growth in West Texas and South Texas, all of the above are now bi-directional to allow gas to flow either north or south to balance what is now a more complicated and dynamic market.

Gas Pipelines Into and Out of the Agua Dulce Hub. Source_RBN

Figure 1. Gas Pipelines Into and Out of the Agua Dulce Hub. Source: RBN

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