P&GJ's 31st Annual 500 Report: Shale Resources Continue To Improve U.S. Natural Gas Outlook

Pipeline & Gas Journal’s 31st Annual 500 Report is the industry’s most detailed statistical listing of the nation’s energy pipeline systems. As in past years, the report ranks the nation’s top liquids, gas transmission and gas distribution systems. Gas transmission companies are ranked by total miles of pipe while the rank of each liquids pipeline company is determined by yearly crude deliveries.

Additional statistical data compiled for the report are based on operating revenue; net income; total throughput of natural gas; barrels of crude and refined products delivered; miles of mains and service lines; and additions to plant.

More than 95% of the data presented are based on information from calendar year 2010, compiled through forms filled out by each company listed or data collected at the Federal Energy Regulatory Commission (FERC).
P&GJ makes every effort to provide the latest statistical information available. If your company’s information is incorrect, let us know. We also need to know about any change of address or contact information.

Industry Trends
According to the EIA Annual Energy Outlook 2011, the United States possesses 2,543 Tcf of potential natural gas resources. Natural gas from shale resources, considered uneconomical just a few years ago, accounts for 862 Tcf of this resource estimate, more than double the estimate published last year. At the 2010 rate of U.S. consumption (about 24.1 Tcf per year), 2,543 Tcf of natural gas is enough to supply over 100 years of use. Shale gas resource and production estimates increased significantly between the 2010 and 2011 Outlook reports and are likely to increase further in the future.

In its natural gas outlook, the EIA expects marketed natural gas production to average 66 Bcf/d in 2011, a 4.2 Bcf/d (6.7%) increase over 2010. The entirety of this growth is coming from increases in onshore production in the lower 48 states which will more than offset a steep year-over-year decline of over 0.9 Bcf/d (15%) in the federal Gulf of Mexico (GOM) and a small decline in Alaska. EIA expects that overall production will continue to grow in 2012, but at a slower pace, increasing 1.4 Bcf/d (2.1%) to an average of 67.4 Bcf/d.

The EIA report indicates growing domestic natural gas production has reduced reliance on natural gas imports and contributed to increased exports. EIA expects that pipeline gross imports of natural gas will fall by 4.8% to 8.6 Bcf/d during 2011 and by another 3.1% to 8.4 Bcf/d in 2012. Projected imports of LNG fall from 1.2 Bcf/d in 2010 to 0.9 Bcf/d in 2011 and to 0.7 Bcf/d in 2012.

The report notes the Henry Hub spot price averaged $3.90 per MMBtu in September 2011, 15 cents lower than the August 2011 average. EIA projected the Henry Hub spot prices to fall further in October before rising above $4 per MMBtu in December. This month’s Outlook lowers the 2011 forecast by 5 cents to $4.15 per MMBtu, 24 cents less than the 2010 average.