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Transmission Storage and Distribution

Delivery of Natural Gas to Consumers

Delivering natural gas from natural gas and oil wells to consumers requires many infrastructure assets and processing steps, and it includes several physical transfers of custody.

Natural gas delivery infrastructure can be grouped into three categories:

  • Processing
  • Transportation
  • Storage

Processing Natural Gas for Transportation Via Pipelines

Natural gas transported on the mainline natural gas transportation (pipeline) system in the United States must meet specific quality measures so that the pipeline network (or grid) can provide uniform quality natural gas. Wellhead natural gas may contain contaminants and hydrocarbon gas liquids (HGL) that must be removed before the natural gas can be safely delivered to the high-pressure, long-distance pipelines that transport natural gas to consumers. Natural gas typically moves from natural gas and oil wells through a gathering system of pipelines to natural gas processing plants for treatment.

Natural gas processing can be complex and usually involves several processes, or stages, to remove oil, water, HGL, and other impurities such as sulfur, helium, nitrogen, hydrogen sulfide, and carbon dioxide. The composition of the wellhead natural gas determines the number of stages and the processes required to produce pipeline-quality dry natural gas. These stages and processes may be integrated into one unit or operation, be performed in a different order or at alternative locations (lease/plant), or not be required at all.

The basic stages of natural gas processing/treatment are: 

  • Gas-oil-water separators: Pressure relief in a single-stage separator causes a natural separation of the liquids from the gases in the natural gas. In some cases, a multi-stage separation process is required to separate the different fluid streams.
  • Condensate separator: Condensates are most often removed from the natural gas stream at the wellhead with separators much like gas-oil-water separators. The natural gas flow into the separator comes directly from the wellhead. Extracted condensate is sent to storage tanks.
  • Dehydration: A dehydration process removes water that may cause the formation of undesirable hydrates and water condensation in pipelines.
  • Contaminant removal: Nonhydrocarbon gases—such as hydrogen sulfide, carbon dioxide, water vapor, helium, nitrogen, and oxygen—must also be removed from the natural gas stream. The most common removal technique is to direct the natural gas though a vessel containing an amine solution. Amines absorb hydrogen sulfide and carbon dioxide from natural gas and can be recycled and regenerated for repeated use.
  • Nitrogen extraction: Once the hydrogen sulfide and carbon dioxide are reduced to acceptable levels, the natural gas stream is routed to a Nitrogen Rejection Unit (NRU), where it is further dehydrated using molecular sieve beds.
  • Methane separation: The process of demethanizing the natural gas stream can occur as a separate operation in a natural gas processing plant or as part of the NRU operation. Cryogenic processing and absorption methods are some of the ways used to separate methane from HGL.
  • Fractionation: Fractionation separates the HGL into component liquids using the varying boiling points of the individual HGL. HGL from the processing plant may be sent to petrochemical plants, oil refineries, and other HGL consumers.

Pipelines Transport Natural Gas From Production Fields to Markets

Natural gas transmission pipelines are wide-diameter pipelines and are often the long-distance portion of natural gas pipeline systems that connect gathering systems in producing areas, natural gas processing plants, other receipt points, and the main consumer service areas.

The three types of transmission pipelines are:

  • Interstate natural gas pipelines operate and transport natural gas across state borders.
  • Intrastate natural gas pipelines operate and transport natural gas within a state border.
  • Hinshaw natural gas pipelines receive natural gas from interstate pipelines and deliver it to consumers for consumption within a state border.

When natural gas arrives at the locations where it will be used (usually through large pipelines), it flows into smaller diameter pipelines called mains and then into smaller service lines that go directly to homes or buildings.

Natural Gas Can Be Stored for Peak Demand

Demand for natural gas fluctuates daily and seasonally, while production and pipeline imports are relatively constant in the short term. Storage of natural gas during periods of low demand helps to ensure that sufficient supplies of natural gas are available during periods of high demand. Natural gas is stored in large volumes in underground facilities and in smaller volumes in tanks above or below ground.

The United States uses three main types of natural gas underground storage facilities:

  • Depleted natural gas or oil fields—that are close to consuming areas are where most of the natural gas is stored in the United States.
  • Salt caverns—which provide high withdrawal and injection rates relative to their working natural gas capacity. Base natural gas requirements are relatively low. Most of the salt cavern storage facilities are in salt dome formations in the states bordering the Gulf of Mexico. Salt caverns have also been leached from bedded salt formations in states in the Midwest, Northeast, and Southwest.
  • Aquifers—that are converted to natural gas storage reservoirs, most notably in the Midwest, where water-bearing sedimentary rock formations are overlaid with impermeable cap rock.

The U.S. natural gas pipeline network is a highly integrated network that moves natural gas throughout the continental United States. The pipeline network has about 3 million miles of mainline and other pipelines that link natural gas production areas and storage facilities with consumers. In 2018, this natural gas transportation network delivered nearly 28 trillion cubic feet (Tcf) of natural gas to about 75 million customers.

What comprises this transportation network?

Transporting natural gas from production areas to consumers involves a series of steps that are generally carried out in the following order:

  • Gathering systems, primarily made up of small-diameter, low-pressure pipelines, move raw natural gas from the wellhead to a natural gas processing plant or to an interconnection with a larger mainline pipeline.
  • Natural gas processing plants separate hydrocarbon gas liquids, nonhydrocarbon gases, and water from the natural gas before the natural gas is delivered into a mainline transmission system.
  • Wide-diameter, high-pressure interstate transmission pipelines that cross state boundaries and intrastate transmission pipelines that operate within state boundaries transport natural gas from the producing and processing areas to storage facilities and distribution centers. Compressor stations (or pumping stations) on the pipeline network keep the natural gas flowing forward through the pipeline system.
  • Local distribution companies deliver natural gas to consumers through small-diameter, lower pressure service lines.

Map of U.S. Interstate and Intrastate Natural Gas Pipelines

About half of the existing mainline natural gas transmission network and a large portion of the local distribution network were installed in the 1950s and 1960s because consumer demand for natural gas more than doubled following World War II. The distribution network has continued to expand to provide natural gas service to new commercial facilities and housing developments.

Natural gas prices increased substantially between 2003 and 2008. Higher prices gave natural gas producers an incentive to expand development of existing fields and to begin exploration of previously undeveloped natural gas fields. Advances in drilling and production techniques led to increases in production from shale and other tight geologic formations. These increases in production contributed to general declines in natural gas prices since 2009, which in turn contributed to increases in demand for natural gas for electricity generation and by industry. Consequently, new transmission pipelines were constructed and others are being built to link the expanded and new production sources to more consumers around the country, most notably in the Northeast.