Route

NorthernStar Natural Gas Inc.’s plan to convert a working offshore oil platform and use an already-certified undersea pipeline route for liquefied natural gas (LNG) importation carries less environmental risk than a competing project that California officials rejected earlier this year, according to a company executive.

July natural gas futures went out with a bang on Wednesday as the contract broke two significant patterns en route to its close at $6.929, up 5.2 cents from Tuesday. Not only did the contract break the streak of seven consecutive regular session lower closes, it also was the first expiring prompt-month contract in five months not to go off the board in the $7.50s.

Northern Natural Gas said Friday afternoon it had contracted a repair crew and dive boat that were en route to a leak site (see Daily GPI, March 2) on the Northern-operated Matagorda Offshore Pipeline System offshore Texas. Pending any weather delays, Northern expected the dive boat to arrive at the site late Saturday evening and repairs to begin Sunday. It anticipates restoration of service to some of the affected platforms downstream of Matagorda 758 by the start of Tuesday’s gas day.

Settling lower for the fifth consecutive regular session, March natural gas futures on Friday brushed off winter storm concerns for the weekend en route to carving out a new low for the move at $7.250. The prompt month finished the week at $7.316, down 16.3 cents from Thursday but an astounding $1.297 lower than the contract’s close in the prior week.

While the Mackenzie Gas Project struggles to make land access and benefits agreements with aboriginal centers along its pipeline route, regulators are doing their bit to prevent further delays by preventing the native relations sore spot from spreading.

Just when some producers were getting their hopes up about Hurricane Emily’s route, the National Hurricane Center (NHC) changed its projections for landfall to just south of Brownsville, TX, by Tuesday night or early Wednesday morning (July 20). Producers are likely to spend a third week in a row evacuating offshore personnel and possibly shutting in some production in the vicinity of the hurricane.

Florida Gas Transmission (FGT) said compressor station 12 in Munson, FL, was damaged by high winds. While staff is en route to the station to assist with repairs, damage to roads and bridges have slowed down travel time. For Friday’s gas day, FGT will be scheduling volumes up to 1.5 Bcf/d into the market area. Scheduled volumes into the market area have been about 2 Bcf/d for the past couple of days. If the damage is repaired overnight, FGT will determine if scheduled volumes can be brought up above the 1.5 Bcf/d. The pipeline had an overage alert day on Thursday with a 2% tolerance. Demand on the system continues to be high, while supply remains tight. FGT continues to experienced further decline in receipt gas in Zones 2 and 3. Total system linepack is very low.

Pacific Gas & Electric did not extend a high-inventory OFO beyond Thursday.

Even though a natural gas pipeline would cut across Canada en route to the Lower 48, Canadian officials should back off while U.S. officials decide whether to offer subsidies on a proposed Alaska pipe, Gov. Frank Murkowski said at a Calgary energy conference last week.