Rising demand for natural gas in the U.S. Northeast and regions to its south and west is spurring the development of gas pipeline projects that collectively will enable Marcellus/Utica E&Ps to ratchet up their production into the 2030s. In today’s RBN blog, we continue our review of these projects.
The Marcellus/Utica still has vast amounts of natural gas to supply the ongoing surge in demand from power generators and LNG exporters. But there’s a catch: A significant step-up in Appalachian production can only occur if new pipeline infrastructure is built to transport that gas to where it’s needed.
As the Marcellus/Utica became the U.S.’s premier natural gas production region in the 2010s, a larger portion of its output headed out of the Northeast. An increasingly important part of the story has involved greater demand for gas from within the Northeast, especially the power sector.
In newly announced deals, Antero Resources and Antero Midstream will expand their holdings in northern West Virginia and divest non-core assets in eastern Ohio.
Appalachia is churning out just over one-third of Lower 48 natural gas production and has the potential to produce considerably more. The big question is whether output will finally break out.
After a decade of regulatory and legal challenges, Mountain Valley Pipeline (MVP) finally came into service in the middle of last year. The 2-Bcf/d pipeline — soon to be expanded to 2.5 Bcf/d via additional compression — was designed to ease natural gas takeaway constraints out of the Marcellus/Utica and help production there break past its current plateau near 36 Bcf/d, but bottlenecks on the massive Transco Pipeline have complicated matters. In today’s RBN blog, we look at efforts to unleash more Appalachian gas in the domestic market, focusing on the Southside Reliability Enhancement Project (SREP), which has enabled more gas to reach North Carolina.
The Marcellus/Utica has massive natural gas reserves, but daily, weekly and annual production in the three-state shale play is limited by three key factors: in-region demand, takeaway capacity and gas prices. In recent years, the basin’s output has been rangebound between 34 and 36 Bcf/d and Appalachian producers see only modest gains in 2025. But a handful of pipeline projects and rising gas demand from power generators suggest the Marcellus/Utica may finally be on the verge of a production breakout. In today’s RBN blog, we discuss the leading E&Ps’ production forecasts for 2025 and the prospects for considerably higher output by the end of this decade.
Marcellus/Utica natural gas production grew by leaps and bounds in the 2010s, but the pace of growth has slowed dramatically in recent years, mostly due to takeaway constraints. Finally, the prospects for renewed growth are improving. New pipeline capacity out of Appalachia is coming online — especially to the booming Southeast, and maybe the Gulf Coast too. New LNG export capacity is about to be commercialized. And a lot of new gas-fired generating capacity — much of it tied to planned data centers — is under development within (or very near) the Marcellus/Utica region. In today’s RBN blog, we examine the three big gas-demand drivers behind the shale play’s impending renewal.
For several years now, the biggest hurdle to natural gas production growth in the Marcellus/Utica was takeaway constraints — there simply wasn’t enough capacity on gas pipelines out of Appalachia to support a significant bump-up in regional output. Things have been changing though. The Mountain Valley Pipeline and a slew of expansion projects along Transco are allowing increasing volumes of gas to move to and through Virginia and the Carolinas. The proposed Borealis Pipeline across Ohio would enable up to 2 Bcf/d to move down the Texas Gas Transmission system to the Gulf Coast. And, as we discuss in today’s RBN blog, Kinder Morgan is planning several major projects in the Deep South — including the 2.1-Bcf/d Mississippi Crossing and 1.3-Bcf/d South System Expansion 4 projects — to move more gas into Mississippi, Alabama, Georgia and South Carolina.
The pace of multibillion-dollar acquisitions in the upstream sector may have eased a bit after a frenetic couple of years, but M&A among E&Ps is still happening. And, just as important, producers just coming off big deals are divesting assets that don’t fit their strategies, or reaching agreements to buy “bolt-on” acreage and production in key basins. There’s a lot of M&A “fun, fun, fun” going on, though many of the deals don’t make big headlines because there are only nine or 10 numbers after the dollar sign, not 11. In today’s RBN blog, we look at a variety of recent upstream M&A and divestment announcements and what they tell us about the production end of U.S. energy markets.
