Rapidly rising production in the Permian basin has led to soaring levels of associated gas, outpacing pipeline infrastructure and placing increasing slowdown pressure on other production streams like crude oil and natural gas liquids, Dr. Eugene Kim, Research Director, Americas Gas, told delegates at the Unconventional Resources Technology Conference in Denver.

Natural gas pipelines hit a takeaway pipeline capacity wall in late March 2019, triggered by reduced shoulder season gas demand and pipeline maintenance. The negative pricing that followed highlighted how midstream constraints can cause market volatility, affecting producer development economics and plans.