Expand Energy had recently highlighted a question the market should be taking seriously: Can U.S. natural gas infrastructure keep pace with the next wave of LNG demand?

 

The issue is not simply how much gas the U.S. has. It is where that gas is produced, how quickly production can grow, and whether the infrastructure exists to move it to the LNG export projects that need it.

 

Global LNG Info Analytics has examined this issue in depth and present its findings in a recent consulting note, available exclusively to our Consulting Service's clients (more info).

 

Here are some key findings:

 

☼ Appalachia has the molecules. The Marcellus and Utica formations underpin the largest natural gas-producing region in the United States. But pipeline constraints have limited the region's ability to expand production and reach higher-value markets.

 

☼ Infrastructure and permitting are becoming strategic constraints.

 

☼ Haynesville is helping bridge the gap - for now. Its location near the Gulf Coast gives it a structural advantage in supplying LNG export projects. But Haynesville has a ceiling.

 

These are forecasts, not certainties. But they raise an important strategic question: What happens if LNG demand keeps growing faster than deliverable gas supply?

 

The consequences could include:
● Greater regional gas-price volatility
● Increased competition for supply between LNG exporters, AI-driven power generators and industrial consumers
● Potential constraints on LNG terminal utilization
● Higher feedgas costs and weaker margins for marginal LNG projects
● A potential erosion of the U.S. LNG cost advantage versus global competitors

 

The strategic takeaway:
The United States does not have a natural gas resource problem. It has a logistics and infrastructure challenge.

 

 

Follow Global LNG Info

Follow @GlngInfo