The Great Permian Gas Challenge is afoot to mitigate the basin’s falling prices triggered by midstream bottlenecks in the nation’s most prolific basin. Permian gas volumes in October reached 15.2 BCFD and is expected to nearly double to 28 BCFD in three years. Pipeline capacity now stands at 17 BCFD. Processing capacity has reached 24.5 BCFD—good for now but not enough to meet higher and higher volumes.
Reese Energy Consulting today is studying the Permian’s midstream conundrum where producers are feeling the pinch and twist of gas prices with pipelines now exceeding 80% capacity. The Gulf Coast Express, Permian Highway, and Whistler pipelines to jump in the last few years added 6 BCFD in capacity but was quickly gobbled up by record production. Expansions on all three are slated to go online in 2023.
Houston-based Targa has announced plans to build the Daytona NGL pipeline as an addition to its 550 MBPD Grand Prix NGL pipeline, as well as a new 275 MMCFD gas processing plant in the Delaware. The company in 3Q fired up operations at its 275 MMCFD Legacy plant in the Midland and the 230 MMCFD Red Hills VI facility in the Delaware with numerous other Permian midstream projects in play following its acquisition of Lucid last June.