Companies in this industry own and operate pipelines that transport natural gas from process plants to local distribution systems. Major companies include Energy Transfer Partners, Enterprise Products Partners, Kinder Morgan, and ONEOK (all based in the US), as well as Australian Pipeline, Gazprom (Russia), and TransCanada (Canada).
Demand is driven by economic activity and population growth, which drive energy use. Profitability depends largely on the efficiency of operations. Companies that operate multiple pipeline networks may enjoy economies of scale in purchasing and administrative costs. The US industry is highly concentrated: the eight largest companies account for about 60% of revenue.
Products, Operations & Technology
Natural gas pipeline transportation networks consist of multiple types of pipelines with different functions. Onshore flowlines transport gas from production wells to storage sites. Offshore flowlines take gas to platforms. Gathering lines transport gas to a central site from multiple locations. Trunklines transport gas from production sites to refineries and from refineries to bulk storage facilities. From storage facilities, pipelines take gas to distributors or directly to local customers. Large industrial users often deal directly with pipeline companies, bypassing local distributors.