waha

In the throes of the shoulder season, natural gas forward prices sank further during the March 28-April 3 period amid a healthy supply picture, mild weather and storage inventories that were seen as easily being replenished this summer. May, June and balance-of-summer (May-October) prices slid an average 5 cents, while Permian Basin forward prices joined their cash counterparts in negative territory, according to NGI’s Forward Look.

Although some cooling toward mid-April has added demand to the outlook, natural gas futures were trading slightly lower early Wednesday as deficits were set to shrink over the next few weeks. The May Nymex futures contract was off 1.1 cents to $2.673/MMBtu shortly after 8:30 a.m. ET.

Constraints to the north and to the west have combined to clobber West Texas spot prices this week, including a new all-time low at the Waha hub, and analysts see more volatility on the way as Permian Basin producers wait on additional takeaway capacity.

Insufficient infrastructure will continue to limit access for growing natural gas supply to connect with new demand outlets along the Gulf Coast, leading to ongoing and sometimes exacerbated price weakness in those supply basins for at least the next couple of years, according to BTU Analytics (BTU).

The Centro Nacional de Control de Gas Natural (Cenagas) is working to create Mexico’s first natural gas hub by next year in the industrialized northeastern region, just across the border from South Texas.

As natural gas production in the Permian Basin surges to levels that could essentially tap out the physical capabilities of existing infrastructure in and around the supply region by 2019, the horse race is on for companies to build pipelines that could connect these supplies to new demand markets not too far from home.

Natural gas takeaway from the Permian Basin’s Waha Hub still has room to grow on existing pipelines, with “considerable upside” on potential exports across the border to Mexico, according to an analysis by RBN Energy LLC.

Natural gas takeaway from the Permian Basin’s Waha Hub still has room to grow on existing pipelines, with “considerable upside” on potential exports across the border to Mexico, according to an analysis by RBN Energy LLC.

Western Gas Partners LP’s Delaware Basin Express LLC is holding a nonbinding open season through Sept. 30 for a new pipeline that would serve portions of Reeves, Loving and Ward counties in Texas with capacity from the Delaware Basin to the Waha Hub.