Natural Gas Projects to Remain Flat in 2017
While several billions of dollars of projects are proposed in the U.S. for the Oil & Natural Gas Production sector in the U.S. in 2017, only a fraction of these projects will go through, as economics and other factors weigh in, according to Industrial Info's 2017 Global Industrial Outlook.
Investment in natural gas production and processing declined in 2016, and this is expected to continue into 2017. While rigs are being steadily moved back out into the fields, they are still nowhere near the amount the U.S. saw a few years ago. In addition, few new natural gas processing facilities are on the table. Many site additions and expansions have been put on hold, with natural gas processors in a wait-and-see holding pattern.
While IIR is tracking close to $70 billion in U.S. liquefied natural gas (LNG) projects, these numbers are optimistic at best, as investors wait for customers to sign on in a market in which prices in Asia and other parts of the world are nowhere near what they were a few years ago. The facilities that are moving ahead (after permission from the U.S. Federal Energy Regulatory Commission to build, site and operate a plant and the U.S. Department of Energy to export LNG) are the ones that have sold capacity. While in 2016, there have been delays and cancellations of some of these projects, 2017 is expected to bring more of the same.
Also being planned are micro LNG projects ranging from 100,000 gallons to 300,000 gallons of production per day. While these projects are much smaller scale than the larger export-oriented facilities, they represent a more secure investment with a guaranteed clientele.
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