The Matterhorn Express Pipeline that has been laid 580 miles from the Permian Basin to the Gulf Coast and is now gradually going online will help relieve the giant back-up of associated natural gas that has developed from the Permian Basin’s record oil production.
The glut has been so severe that the price of gas at the Waha Hub at Coyanosa 64 miles southwest of Odessa has been less than zero, but now the 2.5 billion cubic feet per day that the 42-inch Matterhorn will soon be pumping represents a great relief.
Using 3,500 workers and starting in June last year, the line was laid from three to five feet deep east-southeast across 19 counties to Katy, Texas, 30 miles west of Houston.
The companies that completed the project, Devon Energy, MPLX and the White Water and EnLink midstream companies, say it will provide 50 permanent jobs and send $35 million annually to local governments and the state.
Running to the Coastal Bend Header in Wharton County, it includes the 81-mile Waha to Rankin Lateral, the 79-mile Stanton Lateral, the 400-mile mainline, nine smaller laterals, eight compressor stations and a variety of ancillary facilities and sites including 27-meter stations, 8 temporary launcher-receiver sites, 39 mainline valve sites and 4 temporary contractor yards. The contractor was the Gulf Cos. of Houston.
The Greenwood Village, Col.-based East Daley Analytics Co. says the flow should reach 1.5 Bcf/d by the end of December and the full 2.5 Bcf/d capacity by March.
The Texas Independent Producers & Royalty Owners and Texas Oil & Gas associations and the Texas Railroad Commission say the Matterhorn Express is a sterling addition to the state’s already extensive energy pipeline system.
“Infrastructure projects like the Matterhorn Express play a critical role in meeting global energy demand and ensuring energy security for our nation and allies abroad,” TIPRO President Ed Longanecker said from Austin. “The Matterhorn will provide direct access to the Gulf Coast from West Texas, unlocking much of the natural gas production that has been trapped in the region due to a lack of necessary infrastructure and in turn help stabilize regional price volatility.
“However, one pipeline is not enough,” Longanecker said. “For Texas oil and gas producers to continue delivering on their commitment to meet global energy demand, there must be adequate infrastructure in place.
“Together, policymakers, community members and industry alike must come together to support the continued buildout of our energy network.”
TXOGA Chief Economist Dean Foreman said natural gas production in the Permian Basin in July had grown by over 2.4 billion cubic feet per day year-over-year, according to the Energy Information Administration.
“With the addition of 2.5 bcf/d in new egress capacity from the Permian Basin to Katy, Texas, the Matterhorn Express pipeline helps alleviate bottlenecks that have contributed to a prolonged discount on natural gas prices in the region,” Foreman said. “This expanded access to higher-value markets should, in turn, narrow the price differential between the Permian and Henry Hub.
“In the near term Matterhorn’s added capacity is likely to result in higher realized prices across the region, potentially spurring further investment and production, which could eventually require even more takeaway capacity.”
Given the Permian’s leading role in U.S. production and productivity gains, Foreman said, this abundance presents a positive challenge that strengthens U.S. energy security and bolsters Texas’ leadership in LNG exports.
“Over the long term, the Matterhorn will further integrate U.S. natural gas into global markets, benefiting both producers and consumers alike,” he said.
Railroad Commission Communications Director R.J. DeSilva said pipelines like the Matterhorn are an integral part of the energy infrastructure in Texas, the nation’s largest oil and gas producer.
“Pipelines are a safe way to transport vast amounts of oil, natural gas and other products across our state daily,” DeSilva said from Austin. “Additionally as the state works toward further reducing flaring, added pipeline capacity to transport gas helps producers lower the need to flare gas. It’s important to know that the RRC oversees the safety of more than 400,000 miles of pipelines within the state.”
He said his agency conducts inspections during construction to ensure that safety regulations are being followed when a new pipeline is constructed.
“Inspectors conduct annual safety inspections, several thousand a year, of the network of intrastate pipelines to make sure operators adhere to the safety regulations that are designed to protect residents and the environment,” DeSilva said.