Point

Anadarko Petroleum Corp. has agreed to sell Bear Head LNG Corp., a subsidiary that is developing a liquefied natural gas (LNG) receiving terminal at Point Tupper, NS. The sale follows the company’s decision last month to sell Anadarko Canada Corp. (see Daily GPI, June 29).

California’s legislature Thursday put the final exclamation point on the state’s far-reaching move establishing the toughest standards in the nation in an attempt to turn back the clock on greenhouse gas (GHG), or global warming, emissions, passing mandatory reporting and emission limits for electric generation plants, refineries and other major industries (AB 32), along with a ban on adding any new power generation or supply contracts tied to traditional coal-fired power generation (SB 1368).

Except for one essentially flat point (Texas Eastern-East Texas), prices continued to fall across the board Thursday. The screen drop of nearly 30 cents the day before and burgeoning storage inventories again weighed on the cash market. However, prospects of rising heat levels in northern market areas likely were responsible for Thursday’s declines being considerably smaller than those on Wednesday.

Tennessee said it is experiencing hydrocarbon dew point (HDP) temperatures in excess of its 20-degree limit upstream of Station 87 (Portland, TN) due to high levels of hydrocarbons in deliveries into the 500 Line and the limited ability of the Yscloskey Processing Plant to sufficiently process that gas. Targa Midstream, operator of the Yscloskey facility, has informed Tennessee that the plant should be back to full operation by mid to late May. As alternatives to imposing further corrective actions, Tennessee said it is exploring various short-term operational options that may allow continued flows in the affected area in a safe and reliable manner. However, Tennessee asked shippers and producers to consider what steps they may take voluntarily to conform deliveries into the 500 Line, including but not limited to seeking additional processing alternatives such as deliveries to the Toca and/or Discovery processing plants. “Tennessee strongly encourages customers to make these processing arrangements to ensure deliveries into the pipeline system will conform to Tennessee’s posted HDP limit,” the pipeline said. If HDP temperatures are not sufficiently lowered, Tennessee said it will initiate further corrective action to protect operational integrity.

A modestly higher Gulf Coast point prevented a clean sweep of continuing price softness Thursday. A lack of weather-related demand, the additional loss of industrial load associated with a long holiday weekend and prior-day screen weakness combined to send prices lower at all other points.

Mojave Pipeline began taking its compressors at the Topock, AZ border delivery point into Southern California down, one at a time, for exhaust system maintenance Tuesday. The outages, which are scheduled to last through Thursday, reduce capacity into Mojave from El Paso and Transwestern by 165 MMcf/d from a base capacity of 500 MMcf/d.

NGPL reminded shippers of a change in acceptable hydrocarbon dew point (HDP) limits that will take effect Saturday until further notice. In a Dec. 13 posting it had reported experiencing an increase in the measured HDP temperature of gas flowing to its northern market area and said it must act to prevent unacceptable levels of hydrocarbon condensate in the market area as gas temperatures decrease over the winter months. Currently the pipeline has limits of 60 degrees or higher for the Gulf Coast system field zones, 70 degrees or higher for the Amarillo system field zones and 25 degrees or higher for the market area. Starting Saturday, absent mitigating action acceptable to NGPL, it will not confirm nominations of any gas source for receipt into the Gulf Coast system north of Station 302 in the TexOk rate zone that has an HDP temperature of 45oF or higher. The same action will be taken for any receipts into the Amarillo system’s Midcontinent or Permian rate zones that have an HDP temperature of 60 degrees or higher. See the bulletin board for further details.

Prices reacted to heating load either already fading or being on the verge of fading in several market areas by dropping at nearly every point Wednesday. Declines ranged from a little less than 15 cents to around $1.25, with the biggest losses generally concentrated in the Midcontinent/Midwest, Texas Gulf Coast and Northeast.

Operating conditions related to low linepack on the El Paso system stabilized to the point that the pipeline was able to lift Friday the Critical Operating Condition (COC) that it had declared the day before (see Daily GPI, Dec. 9). “With temperatures moderating, receipt volumes appear to be recovering and demand continues to decline,” El Paso said in a bulletin board posting. “System linepack is still low and Washington Ranch Storage Facility is still on withdrawal at maximum capacity. As a result, rather than completely canceling the COC, El Paso is lowering it to a Strained Operating Condition” with a 10% imbalance threshold. Shippers would be allowed to submit make-up nominations Saturday to correct any shortfalls encountered during Friday’s gas day, it added.