A couple of flat points and one in the Midcontinent that rose about a nickel constituted the only exceptions to a continuation of falling cash prices in Wednesday’s launch of the March aftermarket. Moderate to cool weather forecasts for many areas and prior-day futures weakness were responsible for the overriding softness.
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Transportation Notes
NGPL said pipeline replacement work on segment one in its Midcontinent Zone will further reduce pressure on its system, cutting capacity from an already reduced state. The pipeline expects a complete outage on that section of the system Nov. 16-17, affecting about 15 receipt/delivery points.
Texas Gas Plans Third Storage Expansion
To accommodate additional supply coming in from the Rockies Express pipeline and from the Midcontinent and Canada, Boardwalk Pipeline Partners LP said Wednesday that subsidiary Texas Gas Transmission LLC is planning a third expansion of its gas storage operations that would add 113,900 MMBtu/d of deliverability and 10.25 trillion Btu of working gas capacity to its total storage operations, which includes nine fields in Indiana and Kentucky.
Prices Mostly Fall, But Midcontinent and West Up
Prices were mixed in Wednesday’s resumption of trading after a four-day holiday weekend, but generally tended to be stronger in the Midcontinent and West and weaker in the Gulf Coast and Northeast. Rains were dampening power generation load from New Mexico and Texas through the Southeast and Mid-Atlantic, and below normal temperatures in several other areas left the desert Southwest as the only remaining repository of high heat levels.
Northern Border, Williams to Jointly Build NGL Pipeline
Northern Border Partners LP and a subsidiary of The Williams Cos. have agreed to jointly build a 750-mile natural gas liquids (NGL) pipeline from Opal, WY, to the Midcontinent gas liquids market center in Conway, KS. The pipeline will be designed to transport 110,000 bbl/d of NGL, and additional pump facilities would increase the capacity to 150,000 bbl/d.
Moderate Bullishness Dominates Mixed Pricing
Thanks to stronger numbers throughout the Midcontinent and West, gains outweighed losses in a mixed cash market Wednesday. Much like the expiring April futures contract, many points didn’t stray very far from flat.
XTO Raises Annual Production Forecast on Record 1Q Output, Earnings
XTO Energy Inc., which focuses its exploration efforts in the Midcontinent, on Wednesday raised its annual production outlook to 24-26% — 2% more than it forecast just two weeks ago (see Daily GPI, April 4), after reporting record natural gas and oil output for the first quarter along with record earnings.
Some Midcontinent/West Firming in Overall Dips
While most of the market continued its weekend downturn Monday based on weak fundamentals, some Midcontinent/Midwest and West points found enough heating load support to hold firm at flat to up about a dime. The losses ranged from a couple of pennies to nearly a quarter, with Northeast and Louisiana points claiming many of the largest declines.
Southwestern’s Reserves Move 28% Higher in ’04
Houston-based independent Southwestern Energy Co., whose natural gas exploration and production focus is in Texas and the Midcontinent, said Monday that total oil and natural gas reserves jumped 28% in 2004 to 645.5 Bcfe from 503.1 in 2003. Proved developed reserves accounted for 83% of the total.
Mixed Pricing Is Response to Approaching Cold
Quite a few points, mostly in the Midcontinent/Midwest and West regions, were moderately higher Wednesday, but except for a few other gains elsewhere, prices failed to see the price rally that some had expected to be generated by an impending bout of severe winter weather in northern market areas.