This episode of the Pipeliners Podcast features Jimmy Stewart from the Ohio Gas Association discussing the growing intersection between electrical demand and natural gas infrastructure. The conversation explores historical trends in electricity generation, the shifting role of natural gas as a baseload power source, and the increasing pressure from emerging sectors like data centers. The discussion highlights the implications for future pipeline development, infrastructure capacity, and energy policy in the face of rising demand.

Electricity Demand and Gas Pipelining Show Notes, Links, and Insider Terms

• American Petroleum Institute (API) is a U.S. trade association and standards-setting organization for the oil and natural gas industry, referenced as the podcast sponsor and as a body that develops industry standards related to safety, operations, and environmental protection.
• Ohio Gas Association (OGA) is a statewide trade association representing natural gas transmission and distribution companies in Ohio, focused on sharing best practices, training, and regulatory coordination among members.
• Electricity Demand refers to the total amount of electrical power required by consumers over time, discussed in the context of long-term growth driven by data centers, reshoring of industry, population growth, and the retirement of coal-fired generation.
• Natural Gas Pipelines are infrastructure systems that transport natural gas from production areas to power plants, industrial users, storage facilities, and distribution systems, identified as a critical bottleneck in meeting future electricity demand.
• Baseload Generation is power generation that runs continuously to meet minimum electricity demand, with natural gas increasingly replacing coal as a primary baseload fuel source.
• Peaker Plants are natural gas-fired power plants designed to operate during periods of peak electricity demand, historically used when natural gas prices were high and now part of a broader generation mix.
• Shale Gas Development refers to the extraction of natural gas from shale formations using horizontal drilling and hydraulic fracturing, cited as the reason natural gas prices dropped and decoupled from oil prices after 2009.
• Marcellus Shale is a major shale gas formation in the Appalachian Basin, including Ohio, Pennsylvania, and West Virginia, highlighted as a key source of abundant and economically available natural gas.
• Utica Shale is another shale formation in Ohio and surrounding states, discussed as an evolving play producing both natural gas and oil due to advances in drilling and completion technology.
• Coal-Fired Generation refers to electricity produced from coal, which has been steadily retired due to economics, regulation, and environmental considerations, increasing reliance on natural gas.
• Liquefied Natural Gas (LNG) is natural gas that has been cooled into a liquid for export overseas, identified as a growing demand driver for U.S. natural gas production.
• Transmission Pipelines are large-diameter, high-pressure pipelines that move natural gas over long distances, many of which were built decades ago and now face capacity and expansion challenges.
• Distribution Pipelines are lower-pressure pipeline systems that deliver natural gas from transmission lines to end users, including residential, commercial, and industrial customers.
• Throughput refers to the volume of natural gas flowing through a pipeline system over a given period, discussed in the context of record winter demand events.
• Excess Capacity is built-in pipeline or power system capability above average demand levels, necessary to safely handle extreme weather events and peak usage periods.
• Data Centers are large facilities housing computing and data storage equipment, identified as a major new driver of continuous, 24/7 electricity demand requiring reliable power generation.
• Grid Reliability refers to the ability of the electric grid to consistently deliver power without interruptions, a key concern when integrating intermittent energy sources like wind and solar.
• Renewable Energy (Wind and Solar) refers to electricity generated from renewable sources, discussed as intermittent and insufficient on their own to meet constant, high-load demand from data centers.
• Battery Storage refers to technologies used to store electrical energy for later use, discussed critically as currently incapable of meeting large-scale, long-duration electricity demand.
• Gravity Battery is a conceptual energy storage idea involving lifting and lowering heavy weights to store energy, mentioned as an example of solutions that struggle to scale economically and physically.
• Nuclear Power is electricity generation using nuclear reactors, identified as the only large-scale alternative to natural gas for reliable baseload power but constrained by regulatory, economic, and public acceptance challenges.
• Dedicated Power Generation refers to power plants built specifically to serve a single large load, such as a data center, rather than feeding electricity into the public grid.
• Regulatory Barriers describe permitting, environmental review, and policy constraints that make building new pipelines, power plants, and infrastructure increasingly difficult.
• Reshoring is the return of manufacturing and industrial activity to the United States, contributing to increased electricity and natural gas demand.
• Natural Gas Storage refers to underground facilities used to store gas for peak demand periods, noted as an area that has not expanded significantly despite rising demand.
• Peak Demand is the highest level of energy usage during extreme weather or system stress, used to explain why infrastructure must be built for rare but critical conditions.
• Energy Transition is the broader shift in energy sources and infrastructure, discussed as a long-term, evolving process rather than a rapid replacement of hydrocarbons.
• Economic Availability refers to energy resources that are not only technically recoverable but also profitable to produce, emphasized as a key advantage of U.S. shale gas.
• Pipeline Infrastructure Investment describes the capital-intensive process of building new pipelines, compression, and related facilities necessary to meet future demand growth.

Electricity Demand and Gas Pipelining Full Episode Transcript

Russel Treat: Welcome to the “Pipeliners Podcast,” episode 394, sponsored by the American Petroleum Institute, driving safety, environmental protection, and sustainability across the natural gas and oil industry through world-class standards and safety programs.

Since its formation as a standards-setting organization in 1919, API has developed more than 800 standards to enhance industry operations worldwide. Find out more about API at api.org.

[music]

Announcer: The Pipeliners Podcast, where professionals, bubba geeks, and industry insiders share their knowledge and experience about technology, projects, and pipeline operations.

Now your host, Russel Treat.

Russel: Thanks for listening to the Pipeliners Podcast. I appreciate you taking the time. To show that appreciation, we give away a customized YETI tumbler to one listener every episode. This week, our winner is Kayla Horne with Civitas. To learn how you can win this prize, stick around till the end of the episode.

This week, we’re speaking with Jimmy Stewart from the Ohio Gas Association. We’re going to talk about electrical demand and what the future of electrical demand means for gas pipelining.

Hey, Jimmy. Welcome to the Pipeliners Podcast.

Jimmy Stewart: Hi, Russel. It’s a real honor to be here. Appreciate the invitation. Looking forward to it.

Russel: Absolutely. It’s great to have you. I’m glad we got introduced. I asked you on to talk about the correlation between electricity demand and pipelining. I think that’s particularly appropriate given your regional focus in Ohio. Anyways, if you would, maybe tell us a little bit about yourself and what your role is there with the Ohio Gas Association and how you got there.

Jimmy: Sure thing. I can’t say that I had it all planned out when I moved to Ohio about 30 years ago. After finishing grad school over at Xavier — I grew up in West Virginia — my first job was covering Southeastern Ohio, selling Caterpillar equipment. I moved to Athens, which was in the middle of the territory and sold heavy equipment for a few years.

During that time, I had some temporary insanity and ran for city council, which, amazingly enough, won, and then became the auditor of the city and then state rep for a few years, state senate, Senate Majority Leader. Then eventually, I was asked to interview, suggested I interview. I did.

We’d had a retirement at the Ohio Gas Association in 2011. I interviewed for that position. I’d always been really interested in energy issues. My father and oldest brother worked in the coal industry for most of my life. I always had a little bit of an interest in it, a lot of an interest in it.

The timing seemed really good for a variety of reasons. I had never intended to be in politics my whole life. I had never really expected to end up in the legislature, let alone in the leadership in the senate. Sometimes you can’t predict these things. Ultimately, became the President, Ohio Gas Association 14 years ago, in mid-2011. At that point, the OGA was 40 years old. We are now 54 years old.

We were founded then and continue the tradition now of basically being in the business of sharing best practices among our member companies, big and small, on a variety of issues, primarily through our committee structure. We have roughly a dozen committees that cover everything from codes and regs to O&M and DIMP and a whole variety of topics, accident prevention and safety.

As I go to these committee meetings we have in different parts of the state with our members all across the state, it never fails to amaze me that some of our members who may have been in the business for three decades will come to those meetings and they’ll learn things that they weren’t aware of.

They also share their knowledge with each other. It basically helps everybody out. That’s essentially who we are. We represent the transmission and the distribution natural gas companies in Ohio, of which there are, with the co-ops and everything, close to 40.

We also have various affiliate members, from engineering firms to pipeline contractors to accounting firms, you name it, anyone that does business with our industry, and have various training presentations for our members throughout the year and a tech seminar.

If you were to pull up your list of topics with your podcast over the last several years, it reads much like a list of past topics we’ve had at our March technical seminar. It was really interesting to start listening to and looking down the list of your past episodes. I’m like, “We’ve discussed a lot of these issues, either at our tech seminar or in our committee meetings every few months.”

Russel: The topics are definitely thematic for pipeliners. That’s for sure. I wanted to talk to you about electrical demand, and correlate that to pipelining. There’s a lot going on in our business right now, with the recent change in administration, and some pretty significant changes in economic policy, foreign policy, regulatory policy. There’s a lot going on.

Maybe you could talk a little bit about what’s the history of electrical demand, and how that’s driven the need for natural gas, and where you think that’s headed in the future.

Jimmy: I’ll do my best with the history, although humans aren’t real good at knowing their history, and they’re even worse at predicting the future. [laughs] Just with that caveat, I will say, certainly, taking natural gas and burning natural gas for electricity generation is not anything new.

Oddly enough, this time, about 20 years ago, while certainly done and certainly technically possible to do, the problem was, the price of natural gas was high, and it really only made economic sense to do that typically during peak electricity demand times, when electricity prices were higher, and you could generate electricity as needed from natural gas to cover those peak times.

You had a lot of natural gas peaker plants. Around 2008, 2009, 2010, when the economy collapsed, the price of oil collapsed, which used to run pretty much at a ratio, when oil went up, gas went up, and vice versa. There used to be a pretty significant correlation between the two.

Around 2009-ish, that changed, as the shale development was coming on strong in the Marcellus, and some of the plays down in Arkansas, Texas, Oklahoma. The supply of natural gas was keeping the price of natural gas low as the price of oil recovered. Those two prices tended to diverge from that time.

Over the next few years, natural gas prices stayed, from a historic point of view, pretty low and pretty stable. There wasn’t near the volatility. You started to see more of our electricity generation come from natural gas for baseload, but then there was another factor. About that same time, you started to see the, for a variety of reasons, steam coal generation of electricity.

A lot of those coal-fired plants were being shut down. The prediction was, back close to 20 years ago, that by 2014, we would see significant spikes in electricity prices.

For the most part, that didn’t really happen for a couple of reasons, one of which was, as those coal plants were being taken offline, they were being replaced with natural gas generation for baseload because natural gas prices were stable and generally very cheap.

Number two, over the first couple of decades of this century, electricity demand nationwide was pretty flat. Even though we had added nearly 40 million more Americans, legally or otherwise, we added tens of millions of Americans.

You’d think there would be some electricity increase in demand, but it was very, very little, in large part because a lot of the heavy industry was being offshored and energy efficiencies.

Russel: We were offshoring heavy industry, and then doing all these things to conserve electric consumption with better insulation in homes and all kinds of other projects. Fundamentally, all that did is keep…People think that that reduced demand. It didn’t. It just kept it flat. The economy grew, but electrical demand stayed flat.

Jimmy: That’s right, and so the electricity demand was…I mean, there was some tiny, tiny growth during that 20 years, but almost negligible, even though the population was going up. What we’re starting to see, though, is, we’re still seeing the shift away from coal in favor of natural gas to replace that baseload capacity.

That, in and of itself, has increased the demand for natural gas. Also, you’re seeing export both to Canada and Mexico, via pipeline, but primarily through LNG, you’re seeing the export of LNG starting to be a bigger factor as far as where our natural gas is going, the demand for it.

Within the United States, to your point, electricity demand is growing because the coal plants are still coming offline. There are still more going to come offline, be taken offline. That’s going to increase demand.

On top of that, electricity demand overall is starting to grow again, and it’s partly from reshoring and the anticipation of some reshoring of industry, but it’s also driven by these data centers.

This is not unique to Ohio, but they consume an incredible amount of electricity, 24 hours a day, and seven days a week, when the sun is shining and when the sun isn’t shining, so, they have to have that electricity all the time. Clearly, that’s not going to come from coal. It’s probably not going to come from more nuclear plants.

That really doesn’t leave you too many other options, if you want 24/7.

Russel: The other thing that has to be said is that both solar and wind are not reliable enough to provide the kind of high-quality, consistent load that is required by these data centers.

Jimmy: That’s correct. First of all, even if you could store that energy in, say, if we dug up half the planet and build a bunch of battery storage systems, that there’s realistically no way you could store enough electricity to supply electricity demand for the United States for any length of time.

I’ve heard statistics that there’s enough, I think, even in a state like California, there’s enough battery storage that would last the entire state a minute, something like a minute or two. Even if we literally declared a national emergency and everybody put effort into trying to create more battery storage, batteries don’t last forever.

Russel: That’s right.

Jimmy: By the time you got them online, you would constantly having to be bringing more online. It would never, ever end. This is just, as they say, rainbows and unicorns to suggest that you could have…

[crosstalk]

Russel: …Yeah, it is. I read an article just in the last day or two about using coal mines as batteries, and I’m like, “What the heck is this about?” I read it, and what they were talking about is taking heavy weights, and when they had power, running the weights to the top, and when they didn’t have power, they could let the weights fall, and it would generate electricity.

They can handle swings with wind and solar. I’m looking at that, and I’m like, “I got to see the numbers on this.” Would this work at a small scale? Sure. Is it conceptually appropriate? Maybe. Likely. Can it be scaled to provide the kind of power that’s required, in the quantity and with the reliability that’s required? No way. [laughs]

Jimmy: This was going to be used, in what application was it?

Russel: Basically, they were talking about creating a gravity battery. You take a weight, you suspend it. This is oversimplification, but you take a weight, suspend it from a cable. When you have power, you use a motor to run the weight up to the top. When you don’t have power, you let the weight fall, run something to generate electricity.

Jimmy: Got it.

Russel: I’m like, “Yeah, I know how many mine shafts there are, roughly, notionally, and how much electricity is required.” I’m like, “There’s just, there’s no way. You’re just not going to scale that to the size you need it to scale, and that’s without even thinking about the economics of it.” To do something like that at my house, maybe?

Jimmy: Do you suppose, if you did that at a coal mine, would that mean that the coal mining jobs are now green jobs? I don’t know.

Russel: I think you’d have to do it in an abandoned mineshaft. I don’t think you’d do it in a working mineshaft, right?

Jimmy: Either way, I’m sure that someone would call it green jobs and get a government subsidy to do it.

Russel: Yeah, but I’m just elaborating that people keep coming up with these ideas that seem conceptually good, that when you understand the base physics and you understand the scale required, they break down in a hurry.

Jimmy: They do, and ultimately, batteries don’t come from rainbows and unicorns, either. They require a massive amount of earth-moving mining, which is done with, surprise, equipment that runs on diesel fuel. The material is moved with equipment that runs on diesel fuel. It’s trucked, it’s shipped on across a river or an ocean with equipment that runs on diesel fuel.

It’s absolutely absurd to think that somehow this is going to save us, I guess, if that’s the appropriate term.

Even aside from electricity demand, even if you could get all of your electricity from a magic solar panel, or hydro plant, or what have you, even if you could get it all from nuclear, you still need natural gas and hydrocarbons…You need the molecules for a whole bunch of other things.

Russel: That’s right.

Jimmy: There’s no replacement, whether it’s the tires for the Tesla, or the asphalt highway that the Tesla rides on…

Russel: Or fertilizer, or…

Jimmy: Or the fertilizer to feed half the population of the planet. The magic solar panel doesn’t fix that.

Russel: Do you have any sense about what level of electrical demand we’re going to see increase in the next 10 to 20 years?

Jimmy: I have some numbers. I do. Keep in mind, we’ve got two issues. Even if electricity demand didn’t change, which we saw a few years ago, within the electricity that’s being generated, a smaller share coming from coal, a larger share coming from natural gas. Now, we have two issues. That, plus the pie itself is getting larger.

Predicting into the future, I don’t have national numbers. I do, however…In Ohio, there was a wonderful study that came out in February by the Ohio Business Roundtable, very much a comprehensive study about additional electricity demand over the next 10 years.

By about 2035, they were projecting, primarily from the data centers, not exclusively, but largely, they were projecting an additional 16 gigawatts annually of electricity, which, that’s kind of where the study left it, at 16 gigawatts.

Let’s put that in context, and the question is, as we’ve already decided, where is that electricity in and of itself going to come from? It’s not going to come from nuclear or coal, and probably not very much of it can come from solar and wind. That leaves natural gas. How much natural gas would it take to generate 16 gigawatts? That’s what the study didn’t actually address.

If you just do some back-of-the-envelope calculations though, that’s probably the equivalent of close to a 40 percent increase in the amount of natural gas that Ohio consumes in a year. We’re already about the seventh or eighth largest consuming state of natural gas. This is a big number, 40 percent, somewhere in that neighborhood.

Another way of looking at it. In southeastern Ohio, near Cambridge-Byesville area, a couple years ago, the Guernsey Power Station was completed. I believe that is 1.85-ish megawatts.

I believe, my understanding, it would basically require the equivalent of another eight of those to be built. Each one of those was, at the time, between, I think it was, about $1.5 billion, maybe $1.7 billion to build it. That’s the most efficient plant though.

If you build smaller plants that maybe are not quite the same technology, they might be less efficient. That plant runs at about a 60 percent efficiency, as I understand it. If you have plants that run at anything less than that, then you’re talking even more natural gas to generate that much power.

Russel: The bottom line is, in a state like Ohio, in the next 10 to 20 years, we’re seeing a 40 percent increase in natural gas demand.

Jimmy: It could potentially be.

Russel: I’ll make a statement I want you to talk to, see if you agree with it or not. I would say that, from a production capacity standpoint, we have loads of ability to produce that gas. That gas exists. It’s discovered. There are wells that are shut in that could be turned on, and that gas is there.

The problem is getting that gas from the well to the power plant. Getting that done, getting anything built to do that, is becoming crazy difficult.

Jimmy: Yes. This is, as they say, quite a can of worms the more you open this up. You’re spot on. We have the gas. We are in a very fortunate position that we don’t have to take it and build a pipeline from five states away or even next door. We can get it, theoretically, within the state of Ohio, from a handful of counties in eastern Ohio.

Worst case scenario, handful of counties in eastern Ohio, western Pennsylvania, northern West Virginia. They produce as much as all but probably the three largest countries in the world, in terms of natural gas.

Yes, we have it close by or within our borders. There is a lot of transmission pipeline capacity. Let me be back up. There are a lot of transmission lines in the state of Ohio, most of which were built decades ago. There was a lot of excess capacity built into those many decades ago.

The amount of natural gas infrastructure that it takes to power a state like Ohio, with industry…It gets cold. It took decades to build all this. It didn’t happen in 10 years. Imagine, yes, we have some excess capacity to be able to maybe account for some of that additional load, but certainly not all of it.

That’s going to be the challenge, is getting the gas from point A to point B, point B being the power plant or the industrial plant, wherever it’s used, whatever. We’re certainly considering that a large portion of this is probably going to be for electricity demand.

Russel: I’m going to make another comment just for discussion purposes. I think the other thing that I just want pipeliners to hear in this conversation is that the reality is not what we’re hearing in the press, that the reality is there is immense demand for natural gas.

There’s immense demand for new pipelines. That demand’s going to grow. It’s going to be driven by data centers and artificial intelligence…

[crosstalk]

Jimmy: You’re correct. It’s going to be a huge part of it. Frankly, there’s not another viable alternative at this time. Again, predicting the far-off future, humans aren’t real good at that. Who would have predicted that America would be awash in natural gas 20 years ago? Certainly [laughs] not me.

Russel: I remember going to presentations on peak oil and peak gas. We were about to be upside-down with supply and demand. Prices are going to go through the roof. Everybody was licking their chops, man. Then comes shale gas, and then comes shale oil, and oh, my gosh, the whole world changed. Now, instead of being a net consumer of oil and gas, we’re a net exporter.

Jimmy: Can you imagine anyone that tried to write up an energy policy based on what you knew in 2005, or 2006, or 2007? It would have been out of date in five or six years.

Russel: I can. I know people that did. [laughs]

Jimmy: It’s hard to predict, but the way…I’ll add one other twist to this, in that you have to remember, any time, whether it’s natural gas or electric, the system has to be built with excess capacity because obviously you’re not running at full capacity 24/7. There are going to be times when there’s less. There’s going to be times when it’s more.

In the case of electric demand, it’s certainly going to be more. When it gets up to 98 degrees for a week, in the middle of the summer in Ohio, or same thing can happen with natural gas demand in the dead of winter when it gets several degrees below zero. With that said, we are now seeing an increase in natural gas demand, if, for no other reason, to be able to supply electricity generation.

We didn’t really see a big increase like this for a long, long time for the reasons we’ve already talked about, both the gas and electric. Now, we are seeing it, and there is, whatever that peak capacity is, whether you’re talking electric or gas, there is a peak.

Just like the railroads had to build their railroad over the 100-year floodplain because you don’t know when that flood’s going to come, but you want the railroad to be higher than that 100-year floodplain, you have to build out that electrical system or that gas system for the week when it’s 105 degrees in Columbus, Ohio. It’s not going to happen very often, but it will happen.

I’ll share this with you. Back in January, some of our companies had the largest throughput days that they had ever seen. Having said that, they still had excess capacity in their system, which was good, but remember, yes, it got cold in January, but was that the coldest January?

Was that the coldest week, the coldest day that you’ve ever lived through in your life in Ohio or West Virginia or Pennsylvania? No, it wasn’t. Not even close.

I’m not that old, but when I was in the first grade, it was the winter of ’76, ’77 in West Virginia.

Russel: Oh, I remember that.

Jimmy: They closed school. I remember, one week, school was closed for the week, not because it was snowing. It was because they couldn’t afford to heat the schools.

A friend of mine, Jerry James, I’ll give him all the credit for this, president of Artex Oil in Marietta, Ohio, he describes building a natural gas or an electrical system, it’s kind of like if you’re building a cathedral, building a church, and trying to figure out what’s the capacity. You’re essentially building the capacity for Easter Sunday.

Russel: That’s right.

Jimmy: Even though the rest of the year, you know that chances are, it’s not going to be full, but Easter Sunday, it’s going to be full. You have to build with that in mind, that you have to build it out.

Thankfully, many decades ago, our forefathers in the industry built out a lot of excess capacity, and it’s been able, for the reasons we’ve talked about, with electricity demand being flat for several years and what was happening in the natural gas industry, there was a lot of excess capacity.

Now, things are starting to change, and we can still get ahead of this, but, to your point, we have to be able to get that gas in the ground to…

[crosstalk]

Russel: There’s a couple of other points I want to make, because I think they’re material to this conversation. To my mind, the only viable power generation approach versus natural gas is nuke power, and that requires a huge regulatory shift and a huge public shift to accept it. That’s one thing.

I think the other thing that’s interesting, when you start talking about these data centers, I know there have been some data centers that have applied for permits for dedicated power generation.

When you do that, I can do something that’s off the grid, dedicated to my data center, and generates power at a very efficient way because it’s going to be running a very consistent load over a long period of time. You don’t have to oversize it, and you don’t need to swing it, which means I can build it a lot cheaper.

What I’ve been hearing is that the grid owners are not wanting people to do that. They want that generation on the grid, and that creates a whole bunch of other supply chain and construction and engineering challenges. I think that, for the foreseeable future, next 5 or 10 years, we’re going to see growth in pipelining.

Then, I think we’re going to hit some resistance points, and people are going to be looking at different ways to generate power because I think we really need it.

Jimmy: I’ve heard some of the same the same argument there, that, of course, let’s face it, these tech companies have enough money.

They could probably build whatever they want, probably buy up the gas wells and the pipelines in the process, I suspect, if they really wanted to. [laughs] The one caveat on that is that when it comes to electricity demand, these facilities do have to shut down from time to time for maintenance or what have you.

They do have to have some kind of a backup plan, I would presume, for when those plants, if it’s dedicated just to them, for when it does shut down, they would have to have some kind of a backup. Yes, I would say that you’re correct, and unless there’s a seismic shift on the regulatory side for nukes, I don’t know how it’s viable.

I’m not really sure how it’s viable as it is. They built those two additional facilities down in Georgia, that took several years to complete, but, I think, finally wrapped up a couple years ago and was in the tens of billions of dollars. I don’t even think they generate that much more electricity than the Guernsey Power Station, which cost less than $2 billion.

I don’t know if they’re just cheaper to run, or how that works.

Russel: When you’re doing that sort of thing, you’re looking at 50-year economics.

When you look at 50-year economics, it looks different because, those gas plants, they need to be replaced, and the nuke power plants, they don’t have as much moving equipment in them, so they last a lot longer. They can be run a lot longer, so the economics change.

Jimmy: It does. I am no expert on that topic about nuclear power, but it just seems odd that you can have men and women for months at a time on a nuclear-powered submarine underwater, just steps away from where that reactor is, and somehow works out OK. We have 10 or 11 nuclear-powered aircraft carriers, which is probably about…

[crosstalk]

Russel: Makes you wonder why we can’t take that technology and use it to generate power for data centers. I’m certain I know that people are talking about that.

I was in a meeting in Houston. It was a group of veterans that work in the oil and gas industry, and they meet every couple of three months and just talk about whatever’s topical. Had a bunch of private equity guys in there, and they were talking about this subject. They were talking about gas and power, the whole subject we’re talking about.

I made what I thought was a smart-aleck remarks. I’m like, “Well, why don’t they repurpose the nuke reactors off of these decommissioned nuclear boats and use them?” Somebody goes, “Yeah. That’s a good idea. We’re looking into that.” I’m like, “Well, OK.” You never know.

I think the takeaway here is that you can’t look at what’s happened in the last 20 years around gas demand and use it as a way to think about what’s happening in the future because we’re reaching a pivot point. There’s data centers. There’s increasing demand just due to base demand related to population. There’s increasing demand because we’re continuing to move off of coal.

I think there’s going to be increasing demand for bringing manufacturing, particularly burner tips steel, that sort of thing, back from overseas, back to the US.

There’s all kinds of geopolitical reasons, if you’re interested in that stuff, and this is not a geopolitical podcast. I don’t want to really go down that rabbit hole, but there’s all kinds of geopolitical reasons why it makes sense to do that.

Jimmy: Making it a geopolitical podcast might cost you some viewers. Of course, it might pick a few up too, I don’t know.

Russel: There’s enough people doing that. [laughs]

Jimmy: Yeah, I can tell. It is a very valid consideration there. As we already said, 20 years ago, who could have predicted where we would be today? If we were to reconvene this in 2045, God-willing, I suspect there’d be a whole bunch of things that we did not see coming.

Russel: There’s no doubt.

Jimmy: Gosh, you look at it, the way the trajectory is going right now, you could certainly see where, if that 100-year flood, the 500-flood, so to speak, whether it’s a cold winter, or extremely hot summer, or a back-to-back very hot summer followed by an extremely cold winter.

There’s a whole bunch of other things, so many factors here, but you could certainly envision us getting in a real pickle here in the not-too-distant future. I don’t mean to sound alarmist, but, no, something is going to have to change, and we haven’t even addressed the issue of, like, natural gas storage, in these conversations.

It’s very closely related, but it’s something that really hasn’t increased.

Russel: My view on this, I tend to be an optimist. My view on all of this is that if you’re in the natural gas pipelining space, and for that matter, any pipelining space, you’re in a good space.

It’s not going away any time soon, so, there’s lots of things to be hopeful about, and it’s a little countercultural to say that, but even that’s beginning to shift.

Jimmy: Sure.

Russel: The last thing I would say, just kind of wrap up the conversation, is, I think we’re in a place of another transformational change, and that’s really what you’ve been saying as well, is we’ve been marking time for about 20 years off of infrastructure that we built, some of it 50 years ago, some of it 20 years ago.

We’ve been marking time, and we’re getting to the end of that, and something new is going to need to occur.

Jimmy: Yes, it is. To go back to one of my first points, the good news is, at least we have the natural resource available, not only technically available, but economically available, and where I live, it’s very close by.

Ohio, Pennsylvania, West Virginia, are very fortunate in that they have it available within their state lines. You could say the same thing about Oklahoma, Louisiana, Texas, a handful of other states.

There’s certainly more to it than just that, but at least here, in the state that I work in, the resource is at least available and economically available, not just technically available but economically available. I would imagine that there’ll continue to be advances.

For example, it’s not that shale gas was just discovered 20 years ago. They’ve known it was there for many, many decades. It was just how do you get it out of the ground and make money in the process. They’ve certainly improved on what they’re doing on the oil and gas recovery over the last two decades. What was a big well in 2010 was no longer a big well by 2015 and so on.

Russel: So true.

Jimmy: I would have anticipate that they will continue to improve upon what they’ve done. Who’s to say where the next big play is going to be? They thought that the Utica play was basically just natural gas, but then somebody came in and reworked what Chesapeake Energy owned.

Now, suddenly, we’re getting a bunch of oil pumped out of the Utica area in some of these counties where they didn’t really think that was going to be much of a viable play for oil.

Russel: I guarantee you there’s tons of guys running around in pickup trucks with ideas, and there’s tons of guys sitting in their garage trying to build something. Who knows what the future holds?

Jimmy: No doubt.

Russel: Jimmy, I appreciate you, man. I appreciate the conversation. Great to have you on. If there’s an opportunity for us to collaborate on other conversations, let’s do it and see if we can’t help keep things turning to the right.

Jimmy: Appreciate that and appreciate you having me on. Let’s please stay in touch. If I think of anybody I can send your way, I’ll certainly do that.

Russel: I would appreciate it. I’m always looking for interesting conversations.

Jimmy: All right.

Russel: Thank you, sir.

Jimmy: Thank you for what you’re doing.

Russel: I hope you enjoyed this week’s episode of the Pipeliners Podcast and our conversation with Jimmy. Just a reminder before you go. You should register to win our customized Pipeliners Podcast YETI tumbler. Just visit pipelinepodcastnetwork.com/win and enter yourself in the drawing.

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Russel: If you have ideas, questions, or topics you’d be interested in, please let me know on the Contact Us page at pipelinepodcastnetwork.com, or reach out to me on LinkedIn. Thanks for listening. I’ll talk to you next week.

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