Power Outages Up and Down the Natural Gas Supply Chain Impacted Production and Transportation of Natural Gas During Winter Storm, Analysis Finds

April 22, 2021

An analysis commissioned by the Texas Oil and Gas Association (TXOGA) reveals that power outages, which originated at power generation units, were the principal factor for natural gas production and transportation reductions or shutdowns during Winter Storm Uri. The analysis, prepared by Enverus, examined the performance of the upstream and midstream sectors of the Texas natural gas industry during the recent winter storm and factors contributing to performance issues and is based on data from ERCOT and the U.S. Energy Information Administration and surveys of upstream and midstream operators.

“During the February winter storm, failures occurred up and down the line of our state’s electricity system and every sector must improve. This analysis makes clear that the issues with natural gas production and transportation began with outages originating at the power generation units,” TXOGA president Todd Staples said. “Texans deserve a serious, thoughtful, factual evaluation of what really went wrong. Along with many stakeholders, the Texas oil and natural gas industry continues to assess the entire operational process to develop specific solutions to better protect Texans against future emergency situation failures.”


Report 1-Pager


The analysis shows that once power outages at power generation units began due to the extreme cold weather, natural gas production and transportation were impacted because surface facilities and infrastructure rely heavily on electricity for operations. Then, power outages at natural gas facilities impaired the ability of power generators to receive natural gas supplies. Independently, a preliminary report by ERCOT confirms the causes for lost power generation during the February blackouts, listing power plants freezing up as the primary cause, with fuel limitations – which includes loss of natural gas production – representing a very small portion, and ranking fourth in causation.

“While power generation reforms will be needed, we are committed to being part of the solution as well and through analysis and input from stakeholders, we have identified key reforms that will make the most impact,” Staples added. “Based on a thorough review of available data, the most immediate and direct action to ensure sufficient operations of natural gas producers, transporters and storage during future emergencies will be supply chain mapping to identify the infrastructure that is going into the natural gas generators and local distribution companies and, ultimately, ensure power remains to those natural gas production, distribution and storage facilities. Mapping will help prioritize critical load designations of those key facilities, and improved communications from response teams will ensure greater coordination from all participants in the process.”

During the mid-February weather event, all power generation resources showed a decline in output while demand peaked to unprecedented levels. Although natural gas production fell during this event, the timeline outlined in the analysis indicates that power outages made this decline much more significant.

Even so, the analysis confirms that Texas natural gas supply exceeded Texas demand during this period, although matching the supply to the demand could not be accomplished in all circumstances. Additionally, natural gas storage played a key role in meeting Texas’ natural gas demand and withdrawals increased, however, some facilities faced power outages and were not able to operate at maximum levels. Further, natural gas deliveries to LNG terminals, exports to Mexico, and exports to other neighboring regions also decreased which diverted natural gas to be available to meet demand within Texas. Ultimately, the entire energy infrastructure chain was under significant stress during the storm, creating infrastructure challenges which limited the ability of the available natural gas supply to match with demand.

A key to pinpointing the reforms needed is the understanding that Texas is a net exporter of natural gas, meaning Texas produces vast volumes of natural gas in excess of in-state demand. Out-of-state and out-of-country buyers contract for billions of cubic feet daily. A significant shortcoming of our current system is taking steps necessary to ensure this abundant supply is also available, even in times of crisis.

Analyzing data from both upstream and midstream operators found several consistent themes related to causes of natural gas supply limitations. The survey reveals that the common denominator that caused most disruptions to both the upstream and midstream sectors is the loss of power and electricity.

Upstream survey responses, representing 51% of natural gas production in Texas, identified the following causes influencing operations during the storm (operators replied for multiple answers):

  • Loss of power to the site – 65%
  • Wellhead and equipment freeze-offs – 13%
  • Not being able to get production out due to issues with third-party facilities (pipelines, gathering, transmission, processing facilities, plants) – 8.7%

Ninety-one percent of upstream survey respondents said their operations, including wells, surface facilities and sites, are powered through a connection to the electric grid.

Midstream survey responses, 60% of which said they had to shut down pipelines during the storm, identified these issues as the main reasons for disruptions or shutdowns (operators replied for multiple answers):

  • Loss of power – 80%
  • Lack of production from upstream – 80%
  • Road, crew, truck and other logistical issues – 40%
  • Equipment freeze-offs – 20%

The analysis also reveals that interconnections with other non-ERCOT regions don’t help in peak load periods. Other regions’ grids were also experiencing power shortages and outages, and connection doesn’t matter if these other regions don’t have power to send. Importantly, planning for the cold snap by ERCOT was based on 2011 events which, in hindsight, was not as extreme as this mid-February 2021 event. ERCOT could have planned for colder weather, potentially using 1989 as its baseline for preparation.

“Missing from many of the post-storm accounts and opinion pieces is the remarkable way natural gas stepped up to power the vast majority of electricity generation in Texas during the storm. On an annual basis, natural gas represents about 48% of Texas’ electric power generation. During the storm, natural gas increased its percentage of the Texas power generation mix, supplying more than 60% of electricity generation every single day between February 11 and February 18. While power generation from natural gas – and all sources of electricity generation – did not ultimately meet the record-setting electricity needs of Texans during the storm, natural gas-fired electricity carried the biggest load of supplying power to the grid during the weeklong weather event,” Staples concluded.

The findings from this report, and the ERCOT report dated April 6 citing 54% of power generation failures were weather related, should be useful in assisting the Legislature to take action to avoid a repeat of the 2021 storm failures.

Stay Updated

Get quick updates in our e‑newsletter.

Related Updates

April 10, 2024

AUSTIN - Texas’ production of oil, natural gas, and natural gas liquids (NGLs) achieved new record highs for the month of September after achieving record highs just one month earlier in August, according to the Texas Oil & Gas Association’s (TXOGA) monthly energy economic analysis prepared by TXOGA Chief Economist Dean Foreman, Ph.D. Further, as crude and NGL production has climbed, in-state refiners have processed record amounts.

April 10, 2024

AUSTIN - Texas’ production of oil, natural gas, and natural gas liquids (NGLs) achieved new record highs for the month of September after achieving record highs just one month earlier in August, according to the Texas Oil & Gas Association’s (TXOGA) monthly energy economic analysis prepared by TXOGA Chief Economist Dean Foreman, Ph.D. Further, as crude and NGL production has climbed, in-state refiners have processed record amounts.

April 5, 2024

AUSTIN – The Texas Oil & Gas Association (TXOGA) today announced the hiring of Tracy Gonzales as Director of Community Relations for Houston and Southeast Texas. TXOGA President Todd Staples issued the following statement

April 4, 2024

El Paso - The Texas Oil and Gas Association (TXOGA) has partnered with Marathon Petroleum Corporation’s El Paso Refinery to bring the Mobile Energy Learning Unit (MELU) to five schools in El Paso this week, providing hundreds of elementary students a unique opportunity to learn about STEM education and careers in energy through the hands-on, interactive learning exhibit.

March 27, 2024

The Texas natural gas industry is a powerhouse, producing more natural gas than any other state in the nation—and the world is literally knocking at our door in energy need. In addition to cementing America’s energy security, Texas’ natural gas producers, pipelines, refiners, and exporters are playing an essential role in delivering stability in the form of affordable, reliable energy to our trade partners, even in times of continued global unrest.

Subscribe to our mailing list!

Sign up for our newsletter to stay updated on all the latest news and events.

NOTE: Fields with an asterisk * are required.

Contact us

If you are interested in Formula Membership please complete the form and we will be in touch shortly.

NOTE: Fields with an asterisk * are required.