EIA Sees 16 Bcf/d of Pipe Capacity Planned for Next 2 Years
New pipeline development and expansions could add 16 Bcf/d of
capacity to the national transmission network over the next two
years (1999-2000) at an estimated cost of about $9.5 billion,
according to a report by the Energy Information Administration.
While all of the proposed projects may not be built, total
expenditures are expected to far exceed the $5.1 billion invested
during the last major period of pipeline development in 1992-1993.
Since dipping in 1994, investment in additional pipeline
capacity has increased each year and could reach $6 billion in
2000. A major portion of the new investment is designed to increase
access to Canadian gas, according to the EIA's analysis, which is
titled "Natural Gas Pipeline Network: Changing and Growing." The
report is to be included in EIA's upcoming "Natural Gas 1998:
Issues and Trends," which is expected to be released in February.
While more than 11 Bcf/d of capacity was added to the
transmission network in 1998, total costs were relatively low, at
$2.9 billion, compared with projected spending of $3.1 billion in
1999 and $6.3 billion in 2000, EIA said. Although the amount of new
capacity slated to be added during each of those years, 8.2 and 7.8
Bcf/d, respectively, would be less than the amount added in 1998,
the investment will be greater because several major new and
expensive long-distance pipeline systems, such as the Alliance,
Independence, Tri-State, and Vector pipeline systems, are scheduled
to be constructed during the period. Most of the capacity added in
1998 was less expensive expansions and upgrades.
Supporting this expansive pipeline growth, in large part, is the
growing demand for natural gas to generate electricity, EIA noted.
Growing environmental concerns have spurred the construction of
gas-fired generating to replace coal- and oil-fired plants in many
sections of the country. Since 1990, gas use for power generation
has grown at an annual rate of 17% in the Midwest and about 9% in
the Southeast. Although natural gas use for electric generation
grew by less than 1% per year in the Southwest, it still accounts
for more than 22% of all gas consumed in the region. That is the
largest regional use of gas for electric generation in the nation.
For copies see EIA's web site at http://www.eia.doe.gov.
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