Permian Gas Glut Awaits Pipeline Relief as US Geothermal Builds Its Baseload Case
Pipeline developers plan 44.9 Bcf/d of new US capacity through 2027 as the Permian gas glut persists; geothermal developers are pressing Congress and regulators for a different kind of grid role.
Natural gas in the Permian Basin traded at negative prices for most of the first half of 2026, with producers paying to move volumes rather than collecting for them. The response is taking shape in pipeline capacity data: developers plan to bring 44.9 billion cubic feet per day of new US natural gas infrastructure online across 2026 and 2027, according to EIA figures published this year.6
More than two-thirds of that, or 29.7 Bcf/d, originates in Texas, per EIA data, a direct expression of the Permian's associated gas problem. The basin produced 6.6 million barrels per day of crude oil in 2025, up 4% from 6.3 million b/d in 2024, accounting for approximately 48% of US output, EIA international statistics show. Oil-targeting wells kept generating gas as a byproduct, and for much of the first half of this year there was nowhere profitable to send it.6,5
Three of the largest Texas pipelines are expected to enter service before the end of 2026, according to the EIA: Hugh Brinson, the Rio Bravo Pipeline Project and Blackcomb. Whether they arrive on schedule is a separate question. A survey of market participants, reported by OilPrice.com, found that 25% of respondents identified the first quarter of 2027 as the most likely point of relief. More than 10% said they expected the bottlenecks to persist into 2028, and about 7% said "never."6
The NYMEX Henry Hub front-month was at $2.91/MMBtu on Thursday (2026-07-24), a level reflecting no meaningful uplift from basin-level Permian prices still clearing well below national benchmarks. Duration of that disconnect depends on how quickly the new pipes move and, before that, whether they enter service when scheduled.6
US crude output is not providing relief to the associated gas math. Production averaged a record 13.6 million barrels per day in 2025, breaking the previous US and global record of 13.2 million b/d set in 2024, EIA data show. Output ran roughly 40% above each of the two next-largest producers, Russia and Saudi Arabia. Permian growth of 4% year-on-year drove a meaningful share of that increase, and the basin showed no sign of plateauing through year-end.5
The same production surge that generates associated gas also sharpens the political case for carbon-free alternatives. The Department of Energy projects that enhanced geothermal systems could deliver roughly 90 gigawatts of clean power in the US by 2050, enough to supply approximately 65 million homes. That figure has attracted unusual bipartisan attention. The House cleared a geothermal permitting package on Tuesday (2026-06-02), combining Republican-led and Democratic-authored bills in legislation backed by the Trump administration, aimed at removing regulatory obstacles slowing development of a baseload, weather-independent source.4,3
"It's going to be the decade of geothermal," Cindy Taff, chief executive of Sage Geosystems, said in February 2025. A year and a half later, the investment thesis is visibly building. A neighborhood-scale geothermal network came online in Framingham, Massachusetts, by 2024, the first such system in the United States, owned by the state's largest utility, and has since been cited as a proof of concept for shared subsurface heat delivery at community scale.4,2
But the technology is getting ahead of the regulatory architecture. Canary Media reported in April 2026 that outdated and piecemeal state rules risk delaying next-generation geothermal development even as the underlying technology matures. The federal permitting bill addresses some barriers, but state utility regulation was designed for centralized power plants or gas distribution networks, not systems that deliver thermal energy through shared subsurface infrastructure. Who owns the network, how costs are recovered, and how competing users gain access remain unresolved in most jurisdictions where geothermal buildout is plausible.1
The pipeline question and the geothermal question are running on different timescales. In the near term, the test is whether Hugh Brinson, Rio Bravo and Blackcomb start moving Permian gas before the end of the year; each month of delay compounds the pricing pressure on producers already absorbing negative realizations. For geothermal, the Senate still needs to pass the permitting bill, and even then the utility model that would support neighborhood-scale networks at commercial scale has no answer from most state regulators yet.6,31