Injection

FERC staff has given environmental clearance to Gulf South Pipeline Co. LP to construct three new injection/withdrawal wells and 2.37 miles of associated pipeline at its Jackson Gas Storage facility in Rankin County, MS.

FERC staff has given environmental clearance to Gulf South Pipeline Co. LP to construct three new injection/withdrawal wells and 2.37 miles of associated pipeline at its Jackson Gas Storage facility in Rankin County, MS.

Henry Hub spot gas prices should average about $4.84/MMBtu for the rest of the storage injection season but could temporarily “collapse” in October as the market realizes that working gas levels in storage will significantly exceed the traditional 3.2 Tcf “full” level, according to a Monthly Gas Update by Arlington, VA-based consulting firm Energy and Environmental Analysis Inc. (EEA).

Henry Hub spot gas prices should average about $4.84/MMBtu for the rest of the storage injection season but could temporarily “collapse” in October as the market realizes that working gas levels in storage will significantly exceed the traditional 3.2 Tcf “full” level, according to a Monthly Gas Update by Arlington, VA-based consulting firm Energy and Environmental Analysis Inc. (EEA).

In a delayed reaction to the bullish combination of a slightly supportive storage report (78 Bcf injection) and an explosion at the Moss Bluff storage facility east of Houston, the natural gas futures market turned higher Thursday morning as light speculative buying mixed with continued end-user hedging activities. The September contract finished the session at $5.507, up 12.5 cents for the session.

Questar reported experiencing a mechanical failure of unit #5 at its Clay Basin storage facility Sunday evening, and as a result, injection capacity was reduced by 20,000 Dth/d to 350,000 Dth/d for Tuesday’s gas day. The restriction will continue until repairs are completed.

Even before the Energy Information Administration came out with a 102 Bcf storage injection number that was being called the largest post-Labor Day weekly refill ever, the cash market mood was bearish Thursday. Losses at most points were in double digits, with an overall range between about a nickel and nearly 20 cents. The West saw most of the larger declines.

Effective with Saturday’s gas day and until further notice, Northwest was not accepting injection requests for interruptible capacity in its Jackson Prairie Storage Facility. In addition, the pipeline said, all interruptible storage holders must eliminate any existing balances at Jackson Prairie by Aug. 31.

As anticipated, the one-two punch of a larger-than-expected storage injection and what is believed to be the largest-ever power blackout punished cash prices Friday. Declines ranged from about 15 cents to more than half a dollar, with a majority of points dropping 30 cents or more. Northeast citygates predictably racked up most of the largest losses.