Permian Pipeline Expansion Nears 1.5 Bcf/d Capacity for Western US Markets

The Permian Basin is witnessing a strategic shift as natural gas production gains prominence alongside crude oil, driven by rising demand for LNG and data center energy needs. East Daley Analytics forecasts a decline in crude oil rig counts and production, with a pivot toward natural gas-rich areas, especially in the southern Delaware Basin, to meet expanding market demands. Pipeline infrastructure is expanding to support this growth, notably Energy Transfer’s recent Final Investment Decision to enlarge the Transwestern Pipeline, adding 516 miles and nine compressor stations to deliver up to 1.5 billion cubic feet per day of natural gas to markets in Arizona, New Mexico, and beyond by 2029. This expansion aims to address increasing natural gas transport needs westward, complementing existing East-bound pipeline routes supplying LNG facilities. Meanwhile, Permian Resources highlights the positive impact of the One Big Beautiful Bill Act, which reduces taxes and regulatory hurdles, fostering continued investment and operational efficiency in domestic shale production. Together, these developments indicate a significant reorientation of capital and infrastructure in the Permian Basin to capitalize on growing natural gas demand and diversify energy production.