According to Globaldata, 196,130km of planned and announced trunk oil and gas pipelines are anticipated to become operational globally between 2023 and 2030. This consists of 113,099km of planned pipelines that have identified development plans, and 83,031km of early-stage announced pipelines currently under conceptual study, expected to receive development approval.

Based on Global Energy Monitor's 2023 data, Africa and the Middle East account for 49% of the global oil transmission pipeline construction, valued at US$25.3 billion. The report indicates these regions are currently constructing 4,400 km of pipelines with an investment of US$14.4 billion. There are plans for an additional 10,800 km at an approximate cost of US$59.8 billion. 

Before we start to observe US under construction pipelines, here are the five longest upcoming natural gas pipelines globally, expected to commence operation from 2023 to 2030:

1. Xinjiang–Guangdong–Zhejiang SNG Pipeline: 8,972km, owned by several Chinese oil companies, under construction, expected to operate in 2026 with a capacity of 2,899mmcfd.
2. West African Gas Extension Pipeline: 5,600km, owned by NNPC and others, in the FEED stage, expected to start in 2030, connecting Nigeria to Morocco.
3. Canadian Prosperity Project Pipeline: 4,500km, owned and operated by Canadian Prosperity Pipeline Project, in the feasibility stage, expected to start in 2030, with a capacity of 1,099,271bd.
4. Trans Saharan Gas Pipeline: 4,128km, owned by NNPC, Sonatrach, and Ansaldo Energia, in the feasibility stage, expected to start in 2028, connecting Nigeria to Algeria, with a capacity of 2,899mmcfd.
5. West–East IV Pipeline: 3,340km, owned by China National Petroleum and others, under construction, expected to start in 2024, with a capacity of 1,449mmcfd.

Global Market Report 2023: Construction of Oil and Gas Pipelines and Related Structures
In 2022, North America dominated the oil and gas pipeline and related structures construction market, encompassing regions such as Asia-Pacific, Western Europe, Eastern Europe, South America, and the Middle East and Africa.

The market primarily focuses on crude oil and natural gas pipelines, with sectors including upstream, midstream, and downstream, and applications in both onshore and offshore settings.

A key growth driver is the increasing demand for natural gas, leading to a rise in gas transmission pipelines. U.S. natural gas consumption reached 88.5 Bcf/d in 2022, up 5.4% from 2021, and imports grew to 8.3 Bcf/d. This demand is fueling the expansion of the oil and gas pipeline and related structures construction market.

In January 2022, Poland's PGNiG installed an innovative gas pipeline on the Norwegian Continental Shelf using electrically heat-traced flowline technology (EHTF), reducing costs and the carbon footprint.

In July 2021, Artera Services acquired K.R. Swerdfeger Construction Inc. (KRSC), a move expected to enhance Artera's services and expand its gas distribution into Colorado and New Mexico.

The global oil and gas pipeline construction market is set to grow from $234.55 billion in 2022 to $244.25 billion in 2023 at a CAGR of 4.1%. The Russia-Ukraine war's impact on global economic recovery has led to sanctions, commodity price surges, and supply chain disruptions. As a result, the market is expected to reach $273.17 billion by 2027 at a CAGR of 2.8%. This sector encompasses the construction, renovation, repair, and rehabilitation of oil and gas pipelines, mains, refineries, and storage facilities, including new developments and related goods sold by service providers. Only goods and services traded between entities or sold to end consumers are included.

North America Under Construction Pipelines 2023 Outlook 

Pipeline Miles Under Construction: 8,548

Pipeline Miles Planned: 10,321

Total: 18,869

U.S. LNG is crucial for Europe's supply, with growing capacity to meet future EU demand. Haynesville and Permian Basins are addressing the current bottleneck, stepping up to satisfy surging European needs, while Canada focuses on Asian markets. With the potential to streamline permitting and construction, these basins are delivering natural gas to U.S. Gulf Coast LNG facilities. Haynesville's prospects have risen with higher prices and increased demand from nearby LNG plants.

• Midcoast Energy

CJ Express pipeline entered service in April 2021.

• Enterprise Products Partners

Gillis Lateral pipeline and Acadian Haynesville Extension added 1.3 Bcf/d of takeaway capacity, total takeaway capacity 15.9 Bcf/d.

• Energy Transfer

Started construction of 1.65 Bcf/d Gulf Run pipeline to move gas from Louisiana Haynesville to the Gulf Coast.

Acquired Enable Midstream in December 2021, backed by a 20-year agreement with Golden Pass LNG export plant.

Completed the trunk line of Gulf Run by the close of 2022.

• QatarEnergy (70%) and Exxon Mobil (30%)

Under construction: $10 billion Golden Pass LNG export plant in Texas.

• Williams

Final investment decision (FID) on Louisiana Energy Gateway (LEG) project to move 1.8 Bcf/d of gas to several Gulf Coast markets.

LEG expected to enter service in late 2024.

• Kinder Morgan

Evaluating a project to link Texas Haynesville with LNG export points on the Texas side of the border.

• LNG Canada

Expected 2023 startup of $17 billion LNG Canada Export Terminal with 14 mtpa production capacity.

Supplied via the Coastal Gaslink pipeline by TC Energy, nearing 65% completion.

• Repsol (Spain)

Proposed LNG facility in New Brunswick, minimal permitting required.

• Pieridae Energy

Proposed LNG facility in Nova Scotia, expansion on Canada's east coast.

• New Fortress

Agreement with Comisión Federal de Electricidad (CFE) in July to increase natural gas supply to multiple CFE power generation facilities and develop a new LNG hub off the Gulf of Mexico coast at Altamira, Tamaulipas, with FLNG units of 1.4 MTPA each.

A Bit Of History

The Trans-Alaska Pipeline System, an 800-mile engineering landmark, began transporting oil from Prudhoe Bay to the Port of Valdez on June 20, 1977. The U.S. Senate passed the Trans-Alaska Pipeline Authorization Act in July 1973 after concerns about spills and environmental impact. Construction, the largest private project in American history at the time, started with the first section of pipe laid on March 27, 1975.

• Alaska's first commercial oil well was completed in 1902 near Katalla.
• The discovery led to the construction of Alaska Territory's first refinery.
• ARCO and Exxon discovered the Prudhoe Bay field in 1968, North America's largest oilfield.
• Alaska's oil production peaked in 1988, accounting for 25% of U.S. production.
• In 2020, Alaska's oil production dropped to 448,000 barrels per day, the lowest since 1976.
• This 2020 level was over 75% less than the state's peak production of more than 2 million barrels per day in 1988.

North Dakota became the first state to create rules for gathering pipelines, aiming to ensure safe, effective, and affordable construction. Gathering pipelines are underground pipes used to transport crude oil, water, or natural gas from production facilities for disposal, storage, or sale.

Total Number of Oil Pipelines in the United States

Oil is vital for U.S. energy needs, with Americans consuming over 18 million barrels daily as of 2021. Despite rising oil prices and the push for renewables, oil remains key in the domestic and global markets. The U.S. has extensive pipelines, the safest and most efficient transport method for oil. While expanding these pipelines is contentious due to environmental concerns, innovations like drone inspections and leak-preventative materials minimize ecological impact.

• How Many Oil Pipelines Are in the United States? 

As of 2020, the U.S. had 182 active or under-construction oil pipelines, over twice Russia's 61 lines. These pipelines operate around the clock, with Texas producing 42% of domestic crude oil, including barrels from the Gulf of Mexico, the second-largest oil-producing territory. New Mexico accounts for 11%. 

Unlike natural gas pipelines, which are more compressible, oil pipelines require constant heat and monitoring due to environmental risks and potential fires. Advanced control measures even enable operators to safely manage pipelines during high-magnitude earthquakes.

• How Many Active Oil Pipelines Are in the U.S.?

In the U.S., 160 out of 182 pipelines are active, transporting both crude and refined oil to various refineries, many of which are along the Gulf of Mexico. These pipelines play a vital role in employment, especially in oil-rich states like North Dakota, contributing to nearly 8% of the nation's GDP. 

While there are thousands of miles of active pipelines, decommissioning the abandoned ones is a costly and complex process, often involving the removal of the entire pipeline, especially if it's above ground.

• Is the U.S. Pipeline Infrastructure Sufficient?

The U.S., as the world's top oil producer, has the most crude oil pipelines, with about 50% of the pipeline space currently unused. Before the COVID-19 pandemic, 60% to 70% of these pipes were utilized, and more were being built. The pandemic led to a drop in demand, and recovery has been slow.

Now, with rising gas prices and geopolitical shifts, obtaining permits for new pipelines has become more challenging, and complying with environmental regulations has made construction expensive. In 2022, oil pipeline construction declined by 13.4%, with further decreases expected.

Domestically, there is no immediate need for new oil pipelines in the U.S. With only half of existing pipelines in use, current demand is met, though ongoing maintenance is necessary, and future construction may become relevant.

• Why Does the U.S. Import Oil Despite Having Domestic Reserves?

The U.S. imports oil because its daily consumption of oil products outweighs domestic production. Foreign oil is often cheaper, making it more economical to import.

Most American refineries are designed to handle specific types of oil found in the Middle East and Russia. Adapting these refineries to process domestic oil would be a complex and costly procedure.

Oil importation serves as a political tool, forming the foundation of international alliances like OPEC. The power and wealth associated with being a primary exporter in the international oil market make it beneficial for the U.S. to continue importing oil both economically and politically.

Completed US Natural Gas Pipeline Projects in 2022-2023

According to the International Energy Agency (IEA), a series of ambitious projects were undertaken in 2022-2023 In the United States:

Proposed, Under Construction, and Abandoned U.S. Pipeline Projects

1. Ridgeline Expansion Project

Enbridge plans a Ridgeline expansion across Tennessee's Upper Cumberland region. This 125-mile project could service a new plant and includes an electric-powered compressor. Mostly following the existing East Tennessee Natural Gas line, it aims to reduce environmental impact. In the preliminary stage, construction might begin in 2025, with service starting in 2026. Final investment decisions and permits are needed before construction.

1. Summit pipeline

Summit Carbon Solutions aims to build a pipeline to collect carbon dioxide from Midwest ethanol plants and store it in North Dakota. Capable of capturing 12 million metric tons annually, the project equates to the carbon emissions of 2.6 million cars. North Dakota's largest oil driller invested $250 million in the effort.

Slated to be operational by 2025, the company aims to take advantage of U.S. tax incentives. The project supports the viability of ethanol, aligning with U.S. goals to reduce emissions. State and federal incentives may spur similar projects. However, concerns have been raised about safety and environmental risks, with previous incidents cited as warnings.

Under construction

1. Driftwood Line 200 and Line 300 expansions

Houston-based Tellurian is set to begin construction on the Driftwood Pipeline expansion in Louisiana, with operation expected by 2023. Comprising two phases, Lines 200 and 300, the project cleared its environmental review, with FERC finding no significant effects. Tellurian received authorization to complete the project in April 2023, aiming to meet growing fossil gas demand in the region.

1. Mountain Valley Pipeline

The Mountain Valley Pipeline, running from West Virginia to Virginia, is years behind schedule with costs rising to $6.6 billion from an initial $3.8 billion. Despite being 94% complete, lawsuits and protests cast doubts on its completion. On April 1 2023, a federal appeals court upheld a decision to strike down a key permit and rejected another, further hindering the project.

In July 2023, the U.S. Supreme Court permitted the resumption of construction on the controversial $6.6 billion Mountain Valley Pipeline, set to transport fracked gas 300 miles through West Virginia and Virginia. The ruling clears obstacles from lower courts, lifting stays that had stopped the work. The project has faced years of legal challenges and opposition from environmentalists, grassroots groups, and landowners.

Canceled

1. Chickahominy Pipeline

In March 2022, Chickahominy Pipeline LLC, a subsidiary of Virginia-based Balico, canceled an 80-mile pipeline project through central Virginia along with a corresponding power plant project. The company cited “opposition from outside interests and regulations” driven by the renewable energy industry and supportive state legislators, making it "impossible to deliver natural gas to the site," according to AP News. FERC had already removed the pipeline from a permitting queue in February 2021 due to the company's failure to meet completion milestones.

1. North Dakota trans state pipeline 

WBI Energy, based in Bismarck, North Dakota, scrapped a proposed pipeline stretching across the state in May, citing "regulatory uncertainty" and rising costs, despite state grants. However, the company continues to pursue other projects. They recently finished the 100-mile North Bakken Expansion, a $250 million natural gas pipeline, and are planning a 60-mile Wahpeton Expansion for 2024, and a 10.8-mile Line Section 7 Expansion within the state. A proposal for a small natural gas project linking North Dakota to Minnesota also appears likely to progress.

U.S. Pipeline Construction Projects in 2023: Magellan, Kinder Morgan and others

• Kinder Morgan Tejas Pipeline LLC

Kinder Morgan Tejas Pipeline and Howard Energy Partners' joint venture Dos Caminos announced agreements to expand their Eagle Ford natural gas transportation systems. Tejas will build a 67-mile, 42-inch pipeline from Freer to Sinton, Texas, while Dos Caminos will construct a 62-mile, 36-inch pipeline from Webb County to Freer, Texas, including additional facilities. Planned for completion in Q4 2023, the projects will deliver up to 2 billion cubic feet of natural gas per day to U.S. Gulf Coast markets, costing approximately $251 million.

• Bajo del Choique Nordeste pipeline

ExxonMobil is beginning the engineering study for a new $75 million pipeline in Argentina's Neuquén basin. The Bajo del Choique Nordeste pipeline will span 43 km and transport up to 60,000 b/d of oil to the Oldelval pipeline system. Construction is set to begin next year as part of the company's 2023-24 investment plan. The project aims to connect local production systems, with ExxonMobil holding a 90% stake in the area. Oldelval is working on expansion projects to increase transportation capacity in the region, with projected increases in crude oil flow and plans to reach a capacity of 630,000 b/d by 2025.

• Magellan completes construction on pipeline between Odessa, Crane

Magellan Midstream Partners LP has finished building a 30-mile, 16-inch pipeline, expanding its refined petroleum products pipeline system from the Houston area to El Paso, Texas, to a new capacity of 100,000 b/d. The new pipeline runs between Odessa and Crane, Texas, and will include additional operational storage. While the construction is complete, the expected start-up is early 2024. The company can currently transport about 70,000 b/d of refined products like gasoline and diesel to El Paso, with options to access markets in New Mexico, Arizona, and Mexico through connections to third-party pipelines.

• Ohio Valley Connector expansion project

Equitrans Midstream is set to begin construction on the 350-MMcfd Ohio Valley Connector expansion (OVCX) project, aiming for operation by the first half of 2024. The $160 million project received its last outstanding approval from the US Army Corps of Engineers on July 27 2023 and the Notice to Proceed from the Federal Energy Regulatory Commission (FERC) on July 31 2023. The 37-mile expansion will increase the current capacity of 850 MMcfd on the Ohio Valley Connector pipeline, primarily supported by a long-term firm capacity commitment of 330 MMcfd, to meet growing mid-continent and Gulf Coast demand.

• Gandy Beach pipeline project

The Florida Gas Transmission Company's construction on a 1.3-mile gas pipeline expansion to supply MacDill Air Force Base is set to disrupt access to areas west of the Gandy Bridge, including on Independence Day. Beginning on May 17, the project is scheduled for completion in mid-July. Although approved by the Federal Energy Regulatory Commission in March, the expansion has faced criticism from over 100 individuals and environmental groups like Food & Water Watch, concerned about potential pollution of Tampa Bay and destruction of wildlife habitats.

Final Thoughts

In recent years, pipeline construction in the US has encountered significant opposition from environmental activists who aim to hinder the development of infrastructure that perpetuates dependence on fossil fuels.

The extensive network of pipelines across the country plays a vital role in transporting energy, contributing to as much as 8% of the nation's GDP. The oil and gas industry is a key player in sustaining and enhancing the U.S. economy.

Through both exports and imports of oil, the United States maintains its economic robustness. Innovations like drones have been introduced to make oil transportation safer.

Guided by environmental engineers, the industry is shifting towards greener practices. Oil pipelines, as the most efficient and environmentally responsible means of transport, will likely continue to be the preferred method for the foreseeable future.

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