While COVID-19 has certainly presented unprecedented challenges to our nation’s energy industry, it is clear that once this pandemic passes, the industry must be prepared for demand to rebound. As the Houston Chronicle reported last month, a drilling revival may soon be underway in Texas as more than one hundred drilling permits were filed with the Texas Railroad Commission from June 3 to 9 – nearly half of which were filed for projects in West Texas’ Permian Basin.
As drilling and production begins to rise, it is important that the proper infrastructure is in place to transport product to consumer markets, specifically, natural gas that is produced as a byproduct of oil drilling. For many years, the region has lacked the infrastructure necessary to transport record natural gas production from the Permian to consumers and export terminals along the coast.
In fact, as a result of this shortage of pipeline, $750 million worth of natural gas was flared –burned off – in 2018. That is three-quarters of a billion dollars’ worth of fuel that could’ve helped lower energy costs and provided a more environmentally-friendly alternative to other energy sources. Natural gas has been key in lowering global carbon emissions from the electricity generation sector, with the United States leading the charge.
Fortunately, developers are moving forward on new natural gas infrastructure investment, including projects like the Permian Highway, Gulf Coast Express, and Whistler pipelines. These pipelines will provide much-needed capacity to transport natural gas out of the Permian, thereby reducing flaring rates and helping get fuel safely and efficiently to markets.
These projects also bring a welcomed economic boost in the midst of the COVID-induced downturn, providing thousands of family-sustaining jobs, new streams of tax revenue for Texas and municipalities, as well as new economic opportunities for the communities along their routes.