aquifers

Taking a nine- or 10-figure energy infrastructure project from concept to fruition is never easy. Siting dilemmas, permitting woes, commitment-wary customers, financing snags, legal challenges — there are seemingly endless hurdles. And that’s in normal times. Add in market volatility and fast-changing governmental policies and a developer’s job becomes darn-near impossible. In today’s RBN blog, we discuss midstream companies’ uphill battle in advancing infrastructure projects in 2025, focusing on a recently announced greenfield natural gas storage project along the Texas Gulf Coast. 

The U.S. natural gas market is starting its 2015-16 winter season with a whopping 3,929 Bcf in storage, equal to the record maximum level set Nov. 2, 2012.   Meanwhile gas production is also well above last year. Given these conditions, the market will need record demand to absorb incremental production and work off the surplus in storage. But weather forecasts so far are pointing toward a delayed start to winter heating demand. The price of natural gas has sagged under the pressure with the prompt CME/NYMEX Henry Hub futures contract treading at a price less than half this time last year.  And, now, a number of operational factors and constraints are set to kick in for the winter that could further disrupt an oversupplied market. In today’s blog, we look at the storage and transportation dynamics that could factor into how the market balances this winter.