New pipeline capacity has come online in time for the upcoming winter in the Northeast, but it is unlikely that producers can respond fast enough meet rising gas demand, said a BTU Analytics LLC expert.
“In the near term, as we get this new capacity coming online this winter, with more Rover capacity coming online, we’re not expecting producers to be able to fill those pipeline commitments with incremental gas very quickly,” said energy analyst Matthew Hoza during a recent webinar. “The reason is that backlog has been depleted.”
Wells that producers have relied on to quickly and inexpensively ramp up gas production are exhausted, Hoza said, forcing them to drill into new areas to replace those volumes. That will create a lag between new capacity coming online and incremental gas getting to market.