The U.S. shale revolution has fundamentally altered domestic hydrocarbon flows, necessitating a “replumbing” of America as new sources of supply are connected to long-haul transportation and key end markets. The large-scale infrastructure buildout associated with the explosion in unconventional resource development is such a game changer that historic paradigms for midstream funding no longer apply.
IHS estimates that direct capital investment in U.S. oil and gas infrastructure rose from $56.3 billion in 2010 to nearly $90 billion in 2013, with an incremental $80 billion to $90 billion of direct capital expected to be invested in midstream and downstream infrastructure through 2020. Beyond that meaningful near-term rate of change, IHS expects nearly $900 billion of cumulative investment in oil and gas infrastructure through 2025, with natural gas and crude oil gathering, transportation and storage systems garnering nearly 60% of that total. Relative to past periods, those numbers are simply staggering.
So how will this unprecedented buildout be funded?
Read the full article in the PDF below.