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Report: Investment In Natural Gas Pipelines, Infrastructure To Remain Strong Through 2035

On December 20, Penn State Extension summarized the findings of a recent Interstate Natural Gas Association of America Foundation report on natural gas infrastructure saying strong investment in pipelines and other infrastructure will continue through 2035.

The Interstate Natural Gas Association of America Foundation retained ICF to help forecast the amount of midstream infrastructure development needed in the near future.

The study considered infrastructure investments for surface and lease equipment; gathering and processing facilities; oil, gas, and NGL pipelines; oil and gas storage facilities; refineries and oil products pipelines; and export terminals.

The key findings of the study were:

-- Infrastructure investment, while projected to peak in 2019, will remain strong through 2035 due to continued shale development, strong market demand and relatively low pricing due to the new oil and gas supplies.

-- New midstream infrastructure capital expenditures (CAPEX) will average $791 billion over the next 17 years, for an average of $44 billion/year.

-- For oil, gas and NGL transport, an additional 41,000 miles of pipeline and 7 million horsepower (HP) of compression and pumping are anticipated through 2035.

-- To support gathering, processing and storage of oil, gas, and NGLs, an additional 139,000 miles of gathering lines and 10 million HP are required.

-- $1.3 trillion to U.S. and Canadian Gross Domestic Products, or approximately $70 billion annually is anticipated to be invested in infrastructure through 2035.

-- Significant employment opportunities are created not only within states where infrastructure development occurs but across all states because of indirect and induced labor impacts to the tune of approximately 725,000 workers.

-- The infrastructure development is dependent on regulatory approvals of the projects as to the costs for pipeline construction. Two scenarios are used; a constant unit cost and an escalating unit cost.

The report said 48,718 jobs were expected to be created by natural gas infrastrastructure investment in Pennsylvania between 2018 and 2035, which is less than the report’s estimate of 56,450 jobs between 2013 through 2017.

“While we now are in the midst of a remarkable expansion of the pipeline network, this report confirms that there will remain a need for new pipeline infrastructure. Continued production growth, combined with growing consumption – particularly for natural gas – will drive the need for expanded pipeline capacity to supply energy consumers in both domestic and export markets," said INGAA Foundation President Don Santa.

Click Here for a copy of the study.

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[Posted: Dec. 20, 2018]


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