Driven by high prices, depleted storage, demand growth forecasts and signs that conventional production has at best peaked and at worst begun slipping, Canadian natural gas suppliers are hunting a new generation of reserves that can be put to use fast.
storage
Articles from storage
Transportation Notes
Saying it was “experiencing significant linepack loss in the middle of the system while withdrawing at maximum rates from all storage fields,” Tennessee issued an OFO Balancing Alert Friday for all LMS-MA Balancing Parties with meters located in Zones 1 through 4 or in Zone 5 upstream of the Checks (Main Line Valves 245 and 321). Penalties of $15/Dth plus the applicable regional daily spot price will be assessed on shippers whose takes exceed the greater of 500 dekatherms or 102% over scheduled quantities. Penalties will not apply to customers who overdeliver into the system or undertake out of the system, Tennessee said.
Transportation Notes
Union Gas Limited is taking bids through noon EDT Thursday (Sept. 5) for up to 3 Bcf of short-term peak storage service at its Dawn Hub in Ontario over the 2002/2003 winter season. The service is available for the Sept. 6, 2002-March 31, 2003 period. Delivery and receipt points will be at Dawn. See the Union bulletin board for details, or call Mark Bering at (519) 358-4010 for more information.
Transportation Notes
In an online auction scheduled for 11 a.m. CST Monday, Gulf South will accept bids for 5 million dekatherms of Firm Storage Service (FSS) capacity through its web site (www.gulfsouthpl.com, click “Auctions”). The capacity will be available from April 1, 2002 to March 31, 2004. See the bulletin board or call Stacy Franz at (713) 544-5228 for more information.
Transportation Notes
Saying it was experiencing maximum withdrawals at the Washington Ranch storage facility, El Paso declared an Unauthorized Overpull Penalty situation Wednesday morning due to low linepack. Because of the OFO and high system demand, a maintenance shutdown of Line 1100 upstream of Guadalupe Station that had been scheduled for today was postponed until further notice.
Transportation Notes
Saying its storage pools are full and customers are overdelivering gas into its system, Dominion has implemented an OFO to protect its system integrity. The order affects all customers under Rate Schedules FT, FTNN, IT and MCS.
Taking the Path of Least Resistance, Future Continue Down
Adding to losses suffered following the release of fresh storage data Wednesday, natural gas futures continued lower Thursday as traders managed to look past the Enron debacle to focus on the wealth of fundamental and technical factors — all of which point to lower prices. Following in the footsteps of the December contract, January shuffled lower in an organized manner Thursday to close with a 17.1-cent loss at $2.561.
West, Northeast Exceptions to Overall Price Softness
With two hurricanes moving away from the Gulf of Mexico and influences from weather and storage still as negative as they were prior to the weekend, it was natural for most prices to be softening Monday. The exceptions to declining numbers were chiefly in the rebounding West and at Northeast citygates.
Futures Volatility Here to Stay in ‘Tightening’ Market
Stemming the selling pressure set in motion by Wednesday’s storage report, the natural gas futures market rebounded mid-morning Thursday as traders contemplated a supply-demand balance that may be tighter than previously thought. In a rare twist, the 12-month strip gained more (9.5 cents) than either the winter strip (9 cents) or the prompt month (6.8 cents). November closed at $2.486, just off its daily high at $2.51.
Transportation Notes
As posted earlier (see Daily GPI, Oct. 16), Sonat has determined that the three compressors used for injection and compressed withdrawal at the Muldon (MS) Storage Facility cannot be operated in their current condition. Repairs are under way on two units, and one is currently expected to return to service by Thanksgiving. A second unit is expected to be back on-line during the upcoming winter. However, personnel have determined that the third unit cannot be repaired and thus are evaluating replacement options. Sonat expects that replacement parts for the third unit will be installed and it will be available for service in April 2002. The Daily Injection Quantity for each CSS customer will remain at 36% of normal until further notice, but will increase by about 21 percentage points for each unit that is placed back in service. The Daily Withdrawal Quantity will remain at 100% until further notice. “However, if compressed withdrawal is required prior to all three compressor units being placed back in service, some reduction in DWQ is possible,” Sonat said, although that likely would not occur until late winter.