Mountain Valley Finally Flows. Appalachia's Real Constraint Was Never the Rock
On June 11 the Federal Energy Regulatory Commission authorized the Mountain Valley Pipeline to begin service. The 303-mile line can carry up to 2.0 billion cubic feet per day from Wetzel County, West Virginia, to Transco's compressor station 165 in Pittsylvania County, Virginia, where the gas joins the largest interstate system in the country. Its shippers have signed long-term agreements for the full capacity for at least 20 years from the in-service date. The pipeline took the better part of a decade to build, through litigation, permit challenges and a special provision in federal law.
Its completion is the most significant new outlet for Appalachian gas in years. In 2023 it accounted for 29% of gross US production, or 37.7 billion cubic feet per day, more than the Permian or the Haynesville. MVP is an interstate pipeline, regulated by FERC, and its difficulty is typical of that category. The EIA's pipeline tracker shows interstate capacity additions have fallen since 2018 and totaled less than 1.0 Bcf/d in 2023. In 2023, 5.2 Bcf/d of intrastate capacity was added, mostly in Texas and Louisiana, where pipelines can connect the Permian and Haynesville to Gulf Coast industry and LNG export terminals without crossing state lines.
MVP's capacity is significant relative to the bottleneck, though small relative to the basin. In March 2024, EQT announced the acquisition of Equitrans Midstream, MVP's operator, in a deal expected to close in the fourth quarter. Integration reduces the risk that a producer cannot get its gas to market, and it lets the combined company coordinate drilling with pipeline capacity. There is also a reliability angle that the price debate tends to miss. MVP's completion depended on intervention by Congress, which in 2023 directed approval of the remaining permits and limited further judicial review. If the United States is to meet both rising domestic power demand and growing LNG exports, it will need gas from all three major basins.