EQT Warns of Pipeline Capacity Constrains Amid Soaring LNG Demand

EQT Corporation EQT, the second-largest producer of natural gas in the United States, believes that the growing demand for natural gas in the United States is not met with sufficient pipeline capacity. EQT CEO, Toby Rice, recently mentioned that the production of natural gas has increased, however, the pipeline capacity is not enough to transport the commodity per the needs. The demand for liquefied natural gas (LNG) has shown an upward trend over the years, reaching record highs in recent years.LNG Demand Surges as Data Centers Drive Power ConsumptionHuge power consumption by data centers is currently driving the growth of LNG demand in the United States and many companies believe that the infrastructure in place is not enough to meet the rise in production. Several projects associated with the expansion of LNG infrastructure were canceled or delayed over the past few years, which may have contributed to the lack of pipeline capacity, per Rice’s statement. This includes EQT’s Mountain Valley pipeline, which runs from West Virginia to Virginia. The project faced several delays in the past eight years, which ran up the total cost associated with the project to nearly $8 billion. The initial estimated cost of the project was approximately $3.5 billion.The constraints in the transportation of gas, in turn, translate into higher energy bills for consumers in the nation. Rice mentioned that over the past four years, U.S. consumers have witnessed approximately a 35% increase in electricity costs.EIA Projects Record-High Natural Gas Consumption Through 2026The U.S. Energy Information Administration has projected a robust increase in natural gas consumption, including natural gas exports. In 2024, consumption hit a record high of 102.3 billion cubic feet per day (bcf/d). This figure is expected to rise to 105.5 bcf/d in 2025, and even further to 107.6 bcf/d in 2026. A majority portion of this demand growth is expected to come from U.S. LNG exports. The boom in artificial intelligence (AI) and the adoption of cloud computing and digital services worldwide are also contributing to increased demand for power in data centers, driving up the demand for LNG. NextEra Energy Inc. NEE, a U.S.-based renewable energy firm, has projected power demand to rise 20% more in the next two decades compared to the previous two decades. The rise in power demand should also impact the increase in LNG demand.The United States is the largest producer of gas in the world and in 2023, it also became the largest supplier of LNG globally. Following the victory of President Donald Trump, the energy industry received a boost as many regulatory barriers were lifted. President Trump removed a moratorium on new LNG export plant permits that was put in place by the prior administration.Gas Producers Project Output GrowthMany gas-producing firms in the United States expect production levels to rise in the upcoming years including, Range Resources Corporation RRC. RRC projects an annual production of 2.2 billion cubic feet equivalent per day (Bcfe/d) in 2025. This figure suggests an increase compared to the average production of 2.18 Bcfe/d in 2024. Furthermore, its three-year outlook projects an annual production of 2.6 Bcfe/d by 2027.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NextEra Energy, Inc. (NEE): Free Stock Analysis Report Range Resources Corporation (RRC): Free Stock Analysis Report EQT Corporation (EQT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks