- North America, former Soviet Union dominate new development
- Several new pipelines in development, but not without controversy
- Natural gas prices to fluctuate in 2017
The length of natural gas pipelines globally is forecasted to increase 12% by 2020, according to a report by Global Data. The most growth will be in North America and countries in the former Soviet Union.
Several natural gas pipelines are in development. They include:
The Trans-Adriatic Pipeline (TAP) is open to all potential suppliers, a TAP official said. TAP will bring non-Russian gas to southern Europe and Turkey beginning in 2020.
Russian natural gas company Gazprom says it may be interested in using TAP to transport gas to Italy. It has the capacity, but lacks the infrastructure, Gazprom says. This is the first time a partnerships has been mentioned by either party.
Last year, Gazprom signed a memorandum of understanding to transport natural gas to Italy via Greece and the Ionian Sea.
Russian natural gas company Novatek has expressed an interest in entering the Asian market as it says the European market is no longer attractive. Gazprom holds a monopoly on pipelines leading out of Russia. Novatek would be forced to use Gazprom’s proposed Power of Siberia pipeline.
The expansion of natural gas pipelines is not without controversy. Plans to build pipelines near communities often bring resistance and protests. Opponents site environmental and aesthetic concerns.
One example is the Keystone XL and Dakota Access pipelines. Last year, protestors demonstrated for weeks against the Dakota Access pipeline which would cross a burial site sacred to the Standing Rock Sioux as well as the tribe’s only water supply, the Missouri River.
In December, the U.S. Army Corps of Engineers rejected permits for the project. However, four days into his term as president, Donald Trump signed executive orders to resume work on the pipeline. This led protestors to take to the streets in Washington D.C. and New York.
Natural Gas Prices
In 2016, the price of natural gas was $2.50 per British Thermal Unit (mmBTU). This year, however, prices are expected to average between $3.50 and $4 mmBTU as prices have more than doubled since March 2016.
Natural gas prices typically fluctuate. This can be caused, for example, by the market being confident there is enough supply for winter heating. Prices lower, only to increase later.
In 2017, demand will overtake production, which has been declining for the past year and much of what is produced is exported.
In the meanwhile, a mild winter has pushed down natural gas prices to $3.2 mmBTU and gas futures declined .1% for February.
Half of U.S. homes are heated by natural gas, and the industry relies on cold winters to drive up demand.
- Russia and the U.S. account for the majority of the planned pipeline length additions and capital spending.
- Pipelines are planned for crude oil, natural gas, NGL and petroleum products.