Abundant natural gas liquids (NGL) and crude oil growth have led to dozens and dozens of new infrastructure projects for both the United States and Canada, and they can’t come soon enough, according to energy analysts.

On Wednesday Bentek Energy LLC said it is tracking more than 185 oil and NGL infrastructure projects scheduled to be ready in 2014, which likely will lead to “major changes” in the markets over the coming five years as production grows and infrastructure expands. “The magnitude of these changes is expected to be similar to what occurred in the U.S. natural gas market over the past five years,” Bentek noted.

In September Bentek previewed the report, which was produced in partnership with Turner, Mason & Co. (see Daily GPI, Sept. 29). Last month Bentek Vice President Rusty Braziel told NGI that because of the liquids and oil glut, all of the projects on the drawing board would be needed. Through 2014 he said companies were forecast to spend $5.7 billion on new NGL pipelines.

In the final report, Bentek researchers determined that over the coming year “transportation constraints” would continue to pressure prices for West Texas Intermediate (WTI), Rocky Mountain crude and Midcontinent NGLs. In 2013, when some of the pipeline expansions begin to ramp up, supplies then would shift to the Gulf Coast region.

Even though new gas processing plant capacity is expected to “keep pace with growing rich gas production, fractionation capacity could tighten significantly at Mont Belvieu [TX] over the next few years,” said Bentek. “In addition, growing ethane supplies are expected to exert pressure on ethane prices until demand from crackers pulls the slack out of the supply.”

Bradley Olsen of Tudor, Pickering, Holt & Co. said most of the long-haul NGL pipes now winding their way to the Gulf Coast “are running full with the Rockies, the Permian and Midcontinent underrecovering NGLs due to lack of pipe capacity.” The ethane differential between Conway, KS, and Mont Belvieu “remains at historic highs.”

Olsen said strong petrochemical demand for relatively cheap U.S. ethane, combined with global demand for propane and butane and weak natural gas prices, had pushed fractionation spreads “even higher during what has already been a very strong year.” And given the widening Brent-WTI discount, “the demand for logistics to get crude off the lease and to a high-value hub remains elevated…”

Prices are likely to remain under pressure. Canaccord Genuity analysts cut their 2012 price forecasts on Wednesday because “shale-driven uplift” likely will keep the gas market oversupplied while liquids-directed drilling continues to build (see related story). Canaccord reduced the gas price forecast by 50 cents to $4.00/Mcf. It also cut the WTI forecast by $5/bbl to $91.50/bbl in 2011, and by $7.50 in 2012 to $85/bbl to reflect “an increase in the projected Brent/WTI spread specific to next year due to delays in pipelines necessary to alleviate the interior North America supply glut.”

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