Natural Gas Production in Northeast Reduces Need from Other Regions

The Energy Information Administration (EIA) recently released a report based on natural gas production in the northeast and the effects on the region’s gas inflow, reported the Penn State Extension.

Compared to 2008 natural gas records, production in the northeast has increased almost six-fold to 12.3 billion cubic feet (Bcf) per day in 2013.  This upward trend has been reflected in lower prices and an increased natural gas supply.  Natural gas use in power generation continues to increase, and the inflow of natural gas from other regions, such as the southwest, eastern Canada and from the Midcontinent region, has been declining.

There has been a 60 percent drop in natural gas inflows for the first nine months of the year, compared to 2008 inflows.  Despite a 56 percent decrease in net inflow from the Southeast in this period, approximately three-quarters of the gas needed in the northeast is flowing in from the southeast, principally from four major pipelines:  the Columbia Gulf, Tennessee Gas, Texas Eastern, and   Transcontinental Gas.     Inflows may continue to decrease with additional expansions in Marcellus takeaway capacity to the Northeast added at the beginning of this month.

Natural gas net inflow from eastern Canada for the past five-year period decreased by 82 percent. This can be attributed to a higher demand for natural gas in eastern Canada.  With the Tennessee Gas Pipeline expansions completed last year, the Northeast has been exporting greater amounts of natural gas to eastern Canada, as well as compressed natural gas (CNG) by truck.  This has attributed to the Northeast being a net natural gas exporter to eastern Canada on some days.

For the same five year period, there has been a 48 percent decrease in net inflow to the Northeast from the Rockies Express Pipeline due to the increased production.  This has contributed to the lower natural gas prices in the United States and less foreign liquid natural gas imports.

Natural gas production in the northeast has a promising future in bringing the price down, based on transportation and demand for electric generation, and for reversing the flow of natural gas from the traditional south-to-north and west-to-east pipeline flows.

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