Slow

Delay has spread into drilling from notoriously slow pipeline regulation in the Canadian Arctic, holding up long-range exploration and production (E&P) development planning.

El Paso Natural Gas Co. said there was no evidence of corrosion, weld defects, prior gas leakage or slow-developing cracks in the “branch” or “tap” connection of a pipeline that ruptured and exploded Nov. 5 in Bushland, TX. “Instead, we learned the rupture was the result of an upward force on the branch connection that put pressure on a small area on the carrier pipe that contained a ‘lamination.’ The force on the lamination caused a fracture to develop in the lamination near the weld of the branch connection to the carrier pipe, resulting in the rupture,” El Paso said. A lamination is a tiny area of separation within a pipe wall where the metal has not properly bonded to itself, and the lamination feature was not a defect under the regulations of the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration, the company said. Stress Engineering Services Inc. conducted the metallurgical analysis; “We don’t know yet what caused the upward force on the branch connection,” El Paso said. Information about the investigation is at www.elpaso.com/bushlandinfo.

The story, “No Plans to Slow North American Gas Development, Says ExxonMobil Exec,” (see Daily GPI, Sept. 10), misquoted Senior Vice President Mark W. Albers, who was a keynote speaker at the Barclays Capital 2009 CEO Energy/Power Conference in New York City. Albers did not say “North American unconventional gas production will remain steady.” Rather, Albers said, “North American natural gas production will remain steady, with conventional production decline offset by increases in tight gas and shale gas.” NGI regrets the error.

The global integrated oil and natural gas industry will suffer through a “slow and painful” economic recovery in 2010, with worldwide demand lower at a time when inventories are near record highs, Moody’s Investors Service reported Thursday.

Canadian producers are braced for severe summer price lows — possibly below C$2.00/MMBtu (US$1.80) — as international traffic in natural gas continues to slow down on oversupplied markets.

Canadian producers are braced for severe summer price lows — possibly below C$2.00/MMBtu (US$1.80) — as international traffic in natural gas continues to slow down on oversupplied markets.

Despite a few weeks of colder-than-normal temperatures across much of the United States, natural gas inventories are slow to drain, which has kept downward pressure on natural gas prices. According to one energy analyst, the current depression in natural gas prices is likely to continue at least into the spring.

U.S. production and consumption of natural gas is expected to increase and gas imports will decline in the coming years, according to the Energy Information Administration’s (EIA) Annual Energy Outlook 2009 (AEO2009) reference case, an early summary of which was released last Wednesday. It presents updated projections through 2030.

The number of rigs actively exploring for natural gas and oil continues to slow, with the U.S. rig count flat at 1,941 as of Friday after losing a record 51 rigs the week before. Canada operators laid down another 18 rigs last week, Baker Hughes Inc. reported Friday.