As offshore interests continued resuming normal operations in the Western and Central Gulf of Mexico (GOM) Wednesday following the passage of Tropical Storm Edouard, the cash market reflected the neutral guidance of a flat screen the day before. Mixed price movement was mostly close to flat, with gains outnumbering losses.
Quotes ranged from flat to up about half a dollar or down about 35 cents. A solid majority of the changes, either higher or lower, were in single digits. Western points tended to record most of the gains.
Based on reports received from 45 companies by 11:30 a.m. CDT, Minerals Management Service (MMS) said 734 MMcf/d of gas and 36,076 b/d of oil remained shut in Tuesday morning. Those figures were down from 946 MMcf/d and 77,819 b/d, respectively, on Tuesday. The number of evacuated platforms dropped from 154 to 53 while mobile drilling rig evacuations fell from nine to five, MMS said. The gas still off-line represented 9.52% of the estimated GOM output of 7.7 Bcf/d, and the oil volume was about 2.78% of the Gulf’s estimated 1.3 million b/d of production.
Tennessee said it was allowing all production that had been shut in behind the Grand Chenier and Sabine processing plants to resume Wednesday.
ExxonMobil was restoring offshore shut-ins of 25 MMcf/d after inspections of GOM production facilities found no damage, according to a Reuters news story. All ExxonMobil workers had been returned to their offshore posts.
A cold front will reduce cooling load in much of the South Thursday, although highs generally will still be near mid-summer norms, according to The Weather Channel. However, highs in Texas will be ramping up into the 90s again after Edouard’s rains provided some heat relief to most of the eastern half of the state Tuesday and Wednesday.
The Northeast is due to get a bit warmer, but highs won’t exceed the mid 80s except at the region’s extreme southern end. The Midwest will see little change from peak temperatures in the 80s, although a few locations such as Chicago will be in a mild cooling trend.
The Rockies also will be cooling slightly, but the Pacific Northwest can expect a more significant drop of about 10 degrees from an early-week spike of highs into the mid 90s.
Florida Gas Transmission’s (FGT) extension of an Overage Alert Day Tuesday was unable to prevent large drops at FGT-related points that day, but a further extension Wednesday resulted in gains of about a dime and 30 cents at Florida Gas Zone 3 and the Florida citygate, respectively.
A Midcontinent/Midwest marketer said it looks like cooler weather in the market area will last at least through the weekend. Prices tried to rally a little bit from their starting levels but that fizzled, and overall there was little change in numbers from the beginning to end of cash trading, he said.
The marketer doesn’t think Wednesday’s modest September futures advance of 4.7 cents will be able to keep cash firm Thursday. There’s just too little power generation load for air conditioning, and people are pretty comfortable with the progress of refilling storage, he said.
Tropical Depression Edouard was entering its dissipation stage in north-central Texas Wednesday after bringing much-needed rain to Central Texas, said the National Hurricane Center, which issued its final Edouard advisory. At 4 p.m. CDT the storm’s remnants were about 120 miles west of Dallas and maximum sustained winds had fallen to a relatively gentle 15 mph. Tropical activity in the Atlantic Basin was quiet.
The National Weather Service expects below-normal temperatures during the Aug. 11-15 workweek in an area stretching from most of New Mexico through the Northeast and encompassing the eastern Rockies, central Plains, Midcontinent, Midwest and northern reaches of the South. It predicted above-normal readings in southwest Texas, a strip along the Gulf Coast from the southeast corner of Texas through all of Florida and the southern half of Georgia, and in the eastern two-thirds of Montana along with the western edge of North Dakota.
Barclays Capital Research analysts Michael Zenker and George Hopley expect a storage injection of 62 Bcf to be reported for the week ending Aug. 1. Stephen Smith of Stephen Smith Energy Associates is projecting a similar build of 63 Bcf.
Bentek Energy anticipates a moderately higher injection of 66 Bcf, while Tim Evans of Citi Futures Perspective looks for a slightly smaller addition of 60 Bcf. Evans added that he expects injections of 55 Bcf and 75 Bcf for the weeks ending Aug. 8 and Aug. 15, respectively.
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