Pennsylvania Governor Josh Shapiro’s new restrictions on data center development threaten a key source of demand growth for shale gas producers in the state, according to an industry trade group.

“We were disappointed in the announcement in that it sends the wrong message to these incredible economic opportunities that are presented for Pennsylvania and Pennsylvania’s economy,” James D. Welty, president of the Marcellus Shale Coalition, said in an interview with Bloomberg Friday.

The strict guardrails on data centers announced last month are particularly concerning for the state’s gas industry as producers in the Marcellus Basin, which spans most of Pennsylvania and West Virginia, lack the growth opportunities enjoyed by producers in other parts of the US.

Unlike natural gas producers in Texas and Louisiana, which have direct access to soaring demand driven by a wave of planned and under-construction liquefied natural gas export terminals on the US Gulf Coast, Marcellus producers are almost solely dependent on demand growth within their own producing region. Artificial intelligence data centers powered by gas-fired electricity are seen by Marcellus gas producers as a key source of that so-called in-basin demand.

Marcellus gas production growth has been limited for years by steep regulatory challenges to building the interstate pipelines necessary to transport gas to adjacent regions, including New England, where gas and power prices periodically spike as the pipelines connecting the two regions run near full capacity.

“Nine of the last 10 major pipeline projects that would have buoyed export of natural gas from the Marcellus Basin were either canceled or withdrawn,” Welty said. “Knowing those challenges, we are very heavily focused on growing the in-basin demand to kind of get around some of that broader challenge in building out those long-haul pipelines.”

The Marcellus Shale Coalition’s board members include the region’s largest gas producers, including EQT Corp., Expand Energy Corp. and Range Resources Corp., according to the trade group’s website.