28/06/2018 – News / Oil & Gas / Pipelines / GlobalData / US / Russia

US and Russia to dominate global capex on planned pipelines up to 2022

The US and Russia will dominate global capital expenditure (capex) on planned major, trunk crude oil, petroleum products and natural gas pipelines during the outlook period 2018–2022, according to GlobalData.


The leading data and analytics firm also expects Canada, China and Nigeria to be significant spenders on planned pipelines by 2022, considerably expanding their pipeline network.  


The company’s report – ‘Global Planned Pipelines Industry Outlook to 2022’ – forecasts that the global planned natural gas pipeline length will grow to 153,902km by 2022. Planned crude oil and petroleum product pipelines will also expand at an impressive 36,876 km and 30,840 km respectively. 


The US and Russia are set to spend an estimated US$88.4bn and US$78.8bn respectively on their new-build pipelines. The length of the pipelines in the US and Russia will increase to 35,633km and 20,680km respectively, by 2022, should all projects be realised. 


Boom in unconventionals makes US the biggest spender


The US is the biggest spender in the global planned oil & gas pipelines industry, with natural gas pipelines accounting for around 40 per cent of the total planned pipelines network by 2022, followed by crude oil pipelines (31 per cent) and Natural Gas Liquids (NGL) pipelines (24 per cent). 


“Booming unconventional oil and gas production is, in turn, driving the growth of the pipeline network in the US,” explained Soorya Tejomoortula, Oil & Gas Analyst at GlobalData. “More and more operators are focusing on connecting growing unconventional production with the Gulf coast for export of oil & gas.”


Russia to further expand pipeline network for exports


GlobalData identifies Russia as the second most important country in the global planned pipelines industry for spending on upcoming pipelines. The country’s spending is mostly focused on construction of natural gas pipelines, which accounts for 88 per cent of the total planned network expected to start operations by 2022 – followed by petroleum products pipelines and oil pipelines, with a forecast capex share of seven and four per cent respectively.


“Russia is further expanding its massive natural gas pipelines network for exports,” continued Mr Tejomoortula. “The country is building pipelines to transport natural gas from its production centres to demand centres such as China, Japan, India and Europe. ”


Other major players in the pipeline


Additional major countries in terms of capex on planned pipelines include Canada, China and Nigeria. The three countries are expected to account for 9.6, 6.8, and 6.5 per cent respectively of the global pipeline spending by 2022.


The three longest planned pipelines in the world in the outlook period are the 8,972km-long Xinjiang–Guangdong–Zhejiang SNG in China, the 6,000km Russia–India pipeline, and the 4,400km Trans Saharan Gas pipeline in Nigeria. All three are planned natural gas pipelines.

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