Executive Summary:
Infrastructure: Summit Midstream’s new Double E Pipeline expansion addresses a key component for bringing growing Permian gas production to market.
Rigs: The US rig count decreased by 6 for the week of March 14, bringing the total count to 517.
Flows: US natural gas volumes in pipeline samples dropped 1.2% W-o-W, averaging 80.2 Bcf/d for the week ending March 22.
Infrastructure:
Gas pipeline takeaway from the Permian Basin is set to rapidly expand in the years ahead, a key element for meeting robust growth in US natural gas demand. Yet this buildout misses a critical component to bring new supply to market. Summit Midstream (SMC) aims to fill this breach with a new expansion.
In the Macro Supply & Demand Report, East Daley Analytics forecasts US natural gas demand will increase by ~21 Bcf/d over the next five years, driven by LNG exports and incremental power demand from data centers. Meeting this growth will require substantial supply additions, with the Permian projected to contribute ~6.5 Bcf/d through 2030.
At first glance, takeaway capacity does not appear to be a limiting factor. We model Permian egress will expand by more than 11 Bcf/d over the same period. However, this headline capacity masks a critical structural bottleneck: intra-basin connectivity.
Nearly all long-haul pipelines in the Permian originate at the Waha hub, while most new gas processing capacity – 5 Bcf/d currently under development – is concentrated in the northern Delaware Basin. This region offers the strongest gas economics, but lacks sufficient pipeline infrastructure to move volumes to basin pooling points. East Daley estimates only ~1.5 Bcf/d of incremental intra-basin pipeline capacity is currently planned, creating a meaningful shortfall between processing growth and connectivity.
Why Double E Matters
Summit Midstream’s new Double E Pipeline expansion targets this constraint. The system is now fully subscribed at its existing 1.6 Bcf/d capacity after Summit signed new long-term agreements totaling 540 MMcf/d, with ramp-up expected between 2026 and 2029.
Summit announced a binding open season for the expansion on its 4Q25 earnings call. SMC plans to add ~800 MMcf/d through new compression, increasing capacity to over 2.4 Bcf/d by 2028. The project is pending regulatory approval and further commercial backing.
Double E’s strategic value lies in its positioning. The pipeline connects northern Delaware processing plants (30–100 miles northwest of Waha) to major takeaway corridors. It interconnects with key long-haul systems, including Gulf Coast Express, Permian Highway Pipeline, and Transwestern. It also expands optionality with planned links to Energy Transfer’s new Desert Southwest and Hugh Brinson projects, enabling bidirectional market access.
The Permian is transitioning from a takeaway-constrained basin to a connectivity-constrained basin. While downstream capacity is sufficient on paper, molecules cannot reach those pipes without adequate intra-basin infrastructure.
Double E exemplifies the next wave of midstream development — assets designed not to move gas out of basin, but to bridge the gap between processing growth and existing takeaway hubs.
Bottom Line: Future Permian gas growth is increasingly dependent on intra-basin pipeline buildout. Without it, processing expansions in the northern Delaware risk becoming stranded, regardless of how much long-haul capacity is added.
Rigs:
The US rig count decreased by 6 for the week of March 14, bringing the total count to 517. The ArkLaTex (-2), Permian (-1), Marcellus+Utica (-1) and Eagle Ford (-1) lost rigs while the Anadarko (+1) gained rigs W-o-W.
At the company level, OKE (-2), KMI (-2), WES (-2), MPLX (-1), WMB (-1), KNTK (-1), Mustang (-1) and DTM (-1) lost rigs while EPD (+4), ET (+2), Salt Creek Midstream (+1), Canes Midstream (+1), MTSUY (+1) and Fasken Oil and Ranch (+1) gained rigs W-o-W.
See East Daley Analytics’ weekly Rig Activity Tracker for more information on rigs by basin and company.
Flows:
US natural gas volumes in pipeline samples dropped 1.2% W-o-W, averaging 80.2 Bcf/d for the week ending March 22.
Flows in gas basins decreased 1.0% to 50.6 Bcf/d. The ArkLaTex (Haynesville) sample decreased 2.4% to 11.2 Bcf/d, and the Marcellus+Utica slid 0.7% W-o-W at 38.4 Bcf/d.
Samples in liquids basins declined 1.6% W-o-W to 22.6 Bcf/d. The Permian sample decreased 1.6%, while the Anadarko sample declined 2.4%.
Storage:
Traders and analysts expect the Energy Information Administration (EIA) to report a net withdrawal of 46 Bcf for the week ending March 20. A 46 Bcf withdrawal would decrease the surplus to the 5-year average from 47 to 22 Bcf. The surplus to last year would decrease by 79 Bcf to 98 Bcf.
With all eyes on the Middle East the past few weeks, the Lower 48 gas market has been notably quiet. Because the US can meet its own domestic demand needs and still export over 18 Bcf/d via its LNG terminals, the price response to the war in Iran has been muted compared to Europe and Asia. The onset of an early shoulder season has also contributed to the lack of volatility in Henry Hub prices; above-normal temperatures have resulted in springlike weather and few degree days across the US.
Heny Hub cash prices are on track to average just over $3.00/MMBtu in March, $4.70 less than in January. In April, East Daley anticipates a bump in export demand as the new Golden Pass LNG terminal ramps up its first train. There is production capacity (and egress capacity on pipelines to the terminal) that will mute any significant price increase.
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