Bcf

We’ve spent a lot of time here in the RBN blogosphere discussing the trials and tribulations of natural gas producers in the Marcellus and Utica shales who are “trapped behind the pipe,” unable to get sufficient takeaway capacity to move supply to market (both within and outside the U.S. Northeast region) where they could get a higher price for their gas. Pipeline companies have ponied up billions of dollars to build lots of pipe to alleviate these constraints and much more investment is planned. Of course, those pipelines and their committed shippers hope that the investment will pay off long-term – that the economics for building the pipe will justify the cost.   The pipeline will have scores of engineers, lawyers and accountants to figure that out.  But what if you just want to make a quick-and-dirty estimate of the economics?  Well, there is a way. In today’s blog, we walk through the factors you need to consider when your boss runs in and asks, “Hey—what would it cost to move gas there in a new pipe?”