Study Says 10% of Pipeline Compressor Stations at Risk of Outages
Natural gas pipelines use both gas- and electric-powered compressor units. In fact, around 10% of pipeline compressor stations are powered by electricity. Electrically-powered compressor stations on natural gas transmission pipelines have been identified as a possible contributor to gas shortages because they are vulnerable to electric outages during severe weather events. It turns into a vicious cycle. Lack of electricity to the compressor means flows along the pipeline slow or stop, starving power plants of the gas they need to produce electricity. Researchers at Carnegie Mellon University (CMU) recently published an article (study) suggesting possible solutions to fix the issue.
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The U.S. Energy Information Administration (EIA) tracks all things energy and energy-related in the U.S. and around the world. Although the EIA has been somewhat ruined by Bidenista influences, it remains our favorite government agency. The agency’s data and predictions are (mostly) reliable. Yesterday the EIA published new data that shows overall U.S. natural gas consumption in January and February of this year has hit its lowest consumption since 2017 (for January) and 2018 (for February). Why the plunge in natgas usage here at home?
Once a month, U.S. Energy Information Administration (EIA) analysts issue the agency’s Short-Term Energy Outlook (STEO), their best guess about where energy prices and production will go in the next 12 months. Yesterday’s latest edition once again revises down the price EIA believes the Henry Hub will average for all of 2023. Last month’s STEO predicted an annual average of $3.02/MMBtu in 2023. This month’s STEO says the HH will average $2.94. Let’s add some color around that prediction.
Using numbers from its recently published Annual Energy Outlook (AEO) for 2023, the U.S. Energy Information Administration (EIA) predicts natural gas production coming from oil-focused plays, called “associated gas,” will continue to grow for the next 30 years. EIA says associated gas will make up somewhere between 20% and 32% of all natural gas produced over that period of time. As oil drilling continues to expand, so too will associated gas production.
In 2022, the first full year after emerging from the worldwide COVID pandemic, the U.S. and world economies rocketed. Inflation rocketed too, but that’s a different story. Because of the high price for natural gas and oil last year (in response to Russia illegally invading Ukraine), U.S. shale drillers increased capital expenditure spending by a whopping 54% over what they spent in 2021. What about this year? The analysts at RBN Energy have analyzed the announced spending by 42 shale oil and gas producers (with a market cap of at least $500 million) and find this year, shale drillers will only expand spending by a “modest” 17%. What about spending in the Marcellus/Utica?
This is a good news/bad news article. The good news is that the Marcellus/Utica region remained the top-producing natural gas region in the U.S. in 2022, supplying some 29% of all the natural gas produced in the U.S. –averaging 34.6 Bcf/d (billion cubic feet per day). The bad news is that the M-U’s new growth in 2022 was minuscule–just 100 MMcf/d (million cubic feet per day) over 2021 volumes. The Permian Basin (oil-focused) added roughly 2.5 Bcf/d of new natgas production in 2022. The Haynesville, the M-U’s chief competitor, added nearly 2 Bcf/d of extra production last year. Even the Eagle Ford and Anadarko plays added more natgas production last year than did the M-U. Why?
A Boston-based fossil fuel hating group called HEET (Home Energy Efficiency Team) paid big money for a “research report” written by a card-carrying “research activist” targeting Philadelphia Gas Works’ (PGW) plan to upgrade its aging and (in some cases) failing 6,000 miles of natural gas pipelines that make life possible in the City of Brotherly Love. The HEET-funded “study” says PGW should slap a 10-year Band-Aid on leaky pipes because, you know, renewables will take over the world after that. What a load…
The United Nations’ (UN) Intergovernmental Panel on Climate Change (IPCC) published an updated climate change (global warming) report yesterday. It is the hardest of hard-core dictatorial screeds we’ve seen yet out of the UN, an agency that desires to rule the world. The out-of-control UN Secretary-General, Antonio Guterres, said in releasing the report that “Humanity is on thin ice – and that ice is melting fast. Our world needs climate action on all fronts – everything, everywhere, all at once.” Cute–invoking the name of this year’s Oscar winner for Best Picture. Guterres’ preferred solution? “Ceasing all licensing or funding of new oil and gas,” and “stopping any expansion of existing oil and gas reserves.” You read that right. No more new drilling anywhere for fossil fuels, if the UN gets its way.
Unfortunately, the U.S. Energy Information Administration (EIA) seems to have been co-opted by the Bidenistas. It used to be the EIA was independent no matter if Democrats or Republicans controlled the White House. Even when Obama occupied the White House, EIA remained independent. No longer. It’s evident in the EIA’s Annual Energy Outlook 2023, released yesterday, that things have changed at the EIA. Last year EIA showed a chart called U.S. energy consumption by fuel source, 2010-2050 (see 
Uh oh. This isn’t good news for those pegging their hopes and dreams (and financial future) on developing a hydrogen hub in the Marcellus/Utica region. The research arm of Enverus (formerly Drillinginfo), one of the most trusted, energy-dedicated SaaS platforms, offering real-time access to analytics, insights and benchmark cost and revenue data, has just released a new report examining the potential for CO2 storage in Appalachia. The report looks at the geology and the economics of storing CO2 in our region, and the results are not promising.
Last year natural gas consumption in the United States set new record highs in nine of 12 months. In fact, the U.S. used more natural gas in 2022 than it ever has–a new annual record. Natural gas consumption increased in all sectors last year, but the electric power sector consumed more natural gas than any other U.S. end-use sector, accounting for 38% of U.S. natural gas consumption. Which shows the critical importance of the powergen sector to the natural gas sector. The two are joined at the hip.
Last year demand for ethane in the U.S. increased by 9%, which equates to an increase of 200,000 barrels per day (bbl/d). U.S. ethane consumption averaged just under 2.0 million bbl/d in 2022, reaching a peak of almost 2.2 million bbl/d in July. Why the increase? Largely due to two new ethane cracker plants coming online, one in Texas and one in Pennsylvania. The PA Shell cracker and the TX Port Arthur cracker, together, can consume 156,000 bbl/d of ethane.