Gas pipeline companies reported no significant impact on gas transportation operations from what was believed to be the largest power blackout ever last week (see related story). However, some pipelines did report sharp and sudden demand reductions because many gas-fired power plants, chemical companies and industrial manufacturing plants were shut down. As a result, gas prices plummeted and even more gas was expected to be headed into storage.

Spot price declines on Friday ranged from about 20 cents to as much as half a dollar, with Northeast citygates predictably racking up the largest losses. The price declines came despite rising summer heat in the Midwest and Northeast and the impact of Tropical Storm Erika plowing a course through the western Gulf of Mexico toward South Texas (see related story).

Sources reported that TransCanada, Tennessee Gas and other pipeline companies were rapidly stuffing natural gas into storage.

“We didn’t see any impact to our operations as a result of [the blackouts],” said Gina Johnson of Transcontinental Gas Pipe Line. “We were still able to make deliveries and continue normal operations. Most of our compressors run on gas. There is one station, 205 in Lawrenceville, NJ, that runs on electricity. But we have the ability to turn stations on and off and use them as necessary and that station is not an essential station to moving gas.

“If anything we saw decreased demand [Thursday] as a result of the blackouts,” she said. The blackouts obviously reduced gas demand for power generation. They also shut down industrial and chemical plants. NOVA Chemicals reported that it shut down five of its plants, including four in Ontario and one in Ohio. The plants, which use natural gas and gas liquids as a feedstock, will remain down pending stabilization of electrical power.

TransCanada PipeLines spokesman Glenn Herchak said the pipe experienced a sharp drop in demand on the eastern portion of its system once the blackouts hit. “We are monitoring the demand on the system in the East because of plants being out at this point. We have not yet had to reduce receipts of gas on to our system in Alberta, nor have we had to shut in any production. We have had to make some adjustments because of the power losses in the East.

“We do have electric compressors on the line. Most of them that draw electric power from the affected grid have auxiliary power units and were able to use back-up power for control systems. I don’t know definitively if any are out of service; I don’t believe so.”

Herchak said if demand remains sharply reduced the pipeline may have to take action in the producing basins, which could mean forcing producers to shut in production. However, on Friday field receipts actually were rising and TransCanada confirmed that more gas was headed into gas storage fields along the pipeline grid.

Columbia Gas said that it had one electric compressor station go down in northern Ohio, but it was able to maintain deliveries to customers using gas from storage. “We’ve had a few minor power outages at some of our compressor locations within our service area but nothing that has impacted customer service,” said Columbia Gas spokesman Kelly Merritt. “We do have some electric compressors and at least one station is still down in northern Ohio. We were able to change the flow of gas and continue to supply customers with gas from storage.”

Tennessee Gas reported no outages because all of its compressors run on gas.

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