US added record-low amount of interstate gas pipeline capacity in 2022

Monday, March 6, 2023

The least U.S. interstate natural gas pipeline capacity on record was added in 2022, according to the U.S. Energy Information Administration, and nearly all the new capacity was from compressor upgrades, not new pipeline.

EIA is a division of the federal Department of Energy, whose work includes collecting, analyzing, and disseminating independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment. EIA's data and analysis includes electricity, natural gas, oil, and other forms of energy commodities and related infrastructure.

Since 1995, EIA has tracked interstate natural gas pipeline capacity additions. According to EIA's most recent report, in 2022, 897 million cubic feet per day (MMcf/d) of interstate natural gas pipeline capacity was added in the U.S, but this was the smallest amount of new interstate pipeline capacity for any prior year:


According to EIA's State-to-State Capacity Tracker, which contains information on the capacity of natural gas pipelines that cross state and international borders, only five new interstate natural gas projects came online in 2022, and these focused primarily on upgrading compressor stations, "with only one project adding a relatively small amount of new pipe."

EIA says interstate capacity additions were low in 2022 for two primary reasons: more growth in intrastate capacity (not captured in its interstate data), and less overall capital expenditures by oil and natural gas companies.

EIA notes that in prior years, interstate pipeline capacity was added from looping and compressor station projects designed to accommodate growing production in Appalachia. While these types of projects were the most common for developing new interstate pipelines, all of the planned projects are  now mostly completed. 

Since 2017, about 70% of the growth in natural gas production has come from wells in the Permian and Haynesville regions which are near liquefied natural gas (LNG) export terminals sited on the Gulf Coast. EIA also notes growth in intrastate projects, including in Texas and Louisiana where intrastate projects, rather than interstate projects, have increased takeaway capacity and connected natural gas production to LNG export terminals. According to EIA:

Building large-scale, commercial natural gas pipelines that cross state boundaries involves a number of contractual, engineering, regulatory, and financial requirements. These requirements may involve more coordination and can take longer to complete compared with intrastate pipeline projects.

EIA has previously noted decreased capital expenditures by oil and gas companies since 2019.

State utility regulators as well as the regional grid operator ISO New England have found that constraints on interstate natural gas pipeline infrastructure drive up the price of electricity for New England consumers.

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