Potential New Sources of Natural Gas Supply

The projected growth in U.S. natural gas supplies in the reference case is accomplished by expanding domestic production and current sources of imports. However, there are other new potential sources of supply that could make more natural gas available to U.S. consumers and therefore lower prices. They are available in cases where natural gas demand and thus natural gas prices are high enough to support these new potential sources.

One example is natural gas from Alaska, brought to consumers either as liquefied natural gas (LNG) or through a proposed pipeline connecting the Alaskan North Slope to Alberta, Canada, and then to the lower 48 States. A pipeline was discussed in the early 1980s but never built. As of this writing, ExxonMobil Production, BP Exploration Alaska, and Phillips Alaska are working jointly to assess the viability of a pipeline for Alaskan gas, with a potential capacity of up to 4 billion cubic feet per day, or 1.4 trillion cubic feet per year. Implementing a pipeline is estimated to take 5 to 7 years.

A second possibility is expanding U.S. LNG import capacity. In the reference case for this analysis, growth in LNG imports occurs through expansion of existing facilities. Other possible sites for new LNG facilities that are currently being explored include Florida; Baja California, Mexico; the Bahamas with a pipeline connection to Florida; offshore in the Gulf of Mexico; the U.S. West Coast; and the DelMarva Peninsula and North Carolina on the U.S. East Coast. As of this point, none of these proposed projects has moved beyond the planning stage.