East Daley Analytics sees Permian Basin gas production growing around 1.7 Bcf/d by YE24 as egress constraints are relieved by new pipelines coming online over the next two years. We expect the Matterhorn pipeline to launch the next growth phase in the basin, a view backed by newly announced processing expansions.
Matterhorn Express Pipeline is expected to come online in mid-September, according to the contractor building the project, adding 2.5 Bcf/d of capacity from the Waha hub. WhiteWater Midstream confirmed it expects a second pipeline (Blackcomb) to start in 2H26 and contribute another 2.5 Bcf/d of takeaway to South Texas.
EDA's latest oil and gas production forecasts are broken out by basin in the Production Scenario Tools, released to clients earlier this week. The Permian Basin forecast is shown in the figure. Permian natural gas production was handicapped by takeaway constraints in 1H24, but we view Matterhorn as an inflection point for new growth.
We find support for this bullish view in the multiple processing expansions announced in 2Q24 earnings. Energy Transfer (ET), Enterprise Products (EPD), Western Midstream (WES), EOG Resources (EOG) and Targa Resources (TRGP) all rolled out plans for new plants in the basin.
From 2024–26, processing capacity increases by ~3.7 Bcf/d (2.4 Bcf/d in the Delaware and 1.3 Bcf/d in the Midland) in the Permian Supply and Demand Forecast (see figure). With our current production forecast, we expect processing utilization to average 82% for 2024 and increase to 88% by 2026.
New midstream infrastructure will have other impacts to commodity markets. The Matterhorn and Blackcomb pipelines are likely to realign gas flows out of the Permian. The gas processing expansions will also boost NGL production and contribute to filling ~1.2 MMb/d of pipe expansions over the next two years. East Daley is tracking five pipeline expansions in the NGL Hub Model that will loosen NGL pipeline egress from the Permian.
Clients can review the latest monthly updates to the Production Scenario Tools in Energy Data Studio. – Maria Paz Urdaneta Tickers: EOG, EPD, ET, TRGP, WES.
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