Pipeline Costs In Shale Gas Regions

August 2011, Vol. 238 No. 8

Ziff Energy has released a report that analyses the costs for new natural gas transportation infrastructure in the seven North America shale gas regions: Marcellus, Eagle Ford, Haynesville, Barnett, Woodford, Fayetteville, and Horn River.

Ziff Energy’s pipeline cost database incorporates the pipeline companies’ engineering assessments of over 120 pipelines from the past decade. It shows that the average estimated shale gas pipeline costs in 2011 increased to almost $200,000/inch-mile, up three times from 2004.

“All North America geographical regions appear to experience consistently higher pipeline costs than prior years” commented Julia Sagidova, Gas Analyst, and lead author. “The Marcellus shale gas region (Pennsylvania) is the most expensive with an average cost of under $300,000/inch-mile. These large-diameter (24-36 inches) projects are typically 120 miles in length and cost $500 million.”

Figure 1 shows some of the proposed pipelines to bring the growing Marcellus shale gas supply to the market.

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