Midstream company NeuVentus is developing a new natural gas storage hub, the Texas Reliability Underground (TRU) project, 40 miles east of Houston. The project is part of an industry push to prepare for load growth along the Gulf Coast while managing around a regional pipeline bottleneck.
In the Macro Supply & Demand Report, East Daley Analytics expects LNG demand at the Texas-Louisiana border to more than double by the end of the decade. Nameplate LNG demand currently totals ~7.8 Bcf/d from the Sabine Pass, Cameron, and Calcasieu Pass LNG facilities. By late 2029, demand could grow to as high as 16.8 Bcf/d (see figure).
This creates a problem managing flows at the constrained Texas-Louisiana border crossing. East Daley lays out the problem in the Houston Ship Channel Supply & Demand Report. Currently, only ~3 Bcf/d of pipeline capacity is available from the Houston Ship Channel across the Louisiana border to supply this growing LNG demand. As more Permian gas moves to the Gulf Coast, wide swings in regional prices become more likely.
The Ship Channel saw significant volatility in 2022-23 due to pipeline bottlenecks accessing Henry Hub. The influx of Permian gas and growing Haynesville production resulted in basis as weak as $1.97/MMBtu in December ‘22. Recently, in January ‘25, prompt month at HSC traded at a $0.02 premium to the Henry Hub, spurred by fears of winter weather in Texas. However, February prices at HSC eventually settled $1.05 back from Henry, well below the roughly $0.30 transport cost, indicating that upstream constraints are preventing Permian gas from accessing Louisiana markets.
New capacity on Kinder Morgan’s (KMI) Trident Intrastate in 1Q27 (+1.5 Bcf/d) and the combined Blackfin – CP Express line (+3 Bcf/d) should reduce constraints on Texas gas reaching Louisiana LNG projects. However, East Daley still sees some uncertainty, driven primarily by the timing of new infrastructure.
While Blackfin is expected online as early as YE25, the pipe only extends as far as Jasper County in Texas, and an interconnect with CP Express is necessary to move molecules across the border. CP Express is still in the permitting phase, and we expect that pipeline to primarily serve Venture Global’s CP2 LNG, which we don’t expect to come online before 2028.
Several developers have proposed storage expansions to address the infrastructure deficit along the corridor. Austin-based NeuVentus plans to hold an open season for the TRU hub in the near future.
Located near the Moss Bluff salt dome, the TRU project aims to add ~20 Bcf of working storage capacity in two salt caverns, with potential to develop as many as 12 salt caverns (see map). Phase 1 also includes a north-south header line connecting to nine inter- and intrastate long-haul gas pipelines, mostly in Liberty County, TX. The project would add needed liquidity to a fast-growing premium market. – Oren Pilant Tickers: KMI.
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