The INGAA Foundation recently released a study conducted by ICF International highlighting natural gas infrastructure investments. The study titled, “North American Midstream Infrastructure Through 2035: Leaning into the Headwinds,” attributes much of the recent growth in energy exports to the overabundance of current resources. It states that domestically the U.S. cannot use all of the natural gas liquids that it is surfacing.
The study analyzes two different routes of expected NGL production starting from now till 2035. The routes are classified as either a High Case or Low Case. Through an investigation into the results of the study, for the Marcellus Shale region to reach its ultimate potential, the High Case is the necessary track for future energy investments in Pennsylvania. Table 23 shows that we are already headed in that track. The level of NGL infrastructure investments in 2014 are showing similarities to the metrics of the High Case in the study.
What does the High Case mean? It means more investment in energy transport infrastructure – i.e. pipelines like Mariner East. The High Case will generate an overall 2.3 million barrels per day of takeaway pipeline capacity. As a result of this significant increase in capacity, “domestic demand is not expected to absorb all of the growth in NGLs production, opening the doors to more U.S. exports from the Gulf Coast, Mid-Atlantic (Marcus Hook), and Pacific Northwest, especially with expected rises in competitive prices for North American liquids in the global market.”
Due to this increase in capacity and exportation of U.S. goods, the High Case requires more than 12,000 miles of NGL transmission line. The report clearly states that without pipeline additions, NGLs will have to be moved using alternative modes of transportation even though pipelines are the most economical and safest option.
The report signifies that “given the significant production of gas in the Marcellus and Utica plays, NGLs production from the Northeast is expected to grow the most.” In summary, one of the major takeaways from this study is that whether Pennsylvania supports the future High Case or Low Case, one thing is certain, the state needs private investment in order to meet its full potential, and pipeline projects, such as the Mariner East pipelines, are vital to this conclusion.