Warned

The Energy Information Administration in its first Short-Term Energy Outlook following Hurricane Katrina warned the natural gas industry and its customers to prepare for sky-high gas prices this winter.

Tennessee Gas Pipeline warned that it may have to issue an operational flow order due to limited operational flexibility in the Texas (Zone 0) area. the pipeline said it does not have the ability to absorb imbalances caused by overdeliveries into the system and/or undertakes from the system with meters located in Zone 0. It requested that all LMSMA, LMSPL, and LMSPA contracts (including SA contracts acting as balancing parties) in Zone 0 match physical flow with scheduled quantities. “Tennessee requires your compliance with this notice to avoid the necessity of issuing an Operational Flow Order in accordance with the applicable tariff provisions,” the company said.

Kinder Morgan Inc.’s Natural Gas Pipeline Company of America (NGPL) warned shippers Tuesday that it will have to take a 35-mile portion of pipeline on its Amarillo leg between Harper, IA, and compressor station 110 in Geneseo, IL, out of service starting Sept. 1 and lasting for five to seven weeks in order to test and possibly repair the pipeline.

NGPL warned shippers Tuesday that it will have to take a 35-mile portion of its Amarillo leg between Harper, IA, and compressor station 110 in Geneseo, IL, out of service starting Sept. 1 and lasting for five to seven weeks. A line inspection uncovered stress corrosion cracking (SCC) of the metal in the 36-inch diameter pipe. The outage is expected to reduce available capacity by about 134,000 Dth/d. NGPL said shippers should expect 92% of their maximum daily quantity to flow. No secondary, out-of-path firm or interruptible transportation will be available. It is encouraging shippers to use alternative paths to reroute gas around the constraint. It also is seeking FERC approval of a few tariff changes to provide Amarillo leg shippers with “opposite leg rights,” which allow them to use the Gulf Coast pipeline leg at discounted rates (see related story this issue).

El Paso warned customers Tuesday of the possibility that a Strained Operating Condition may need to be issued for Wednesday’s gas day, saying it is experiencing low linepack on the South Mainline and the Washington Ranch storage facility is experiencing maximum withdrawals. “Shippers can obtain supplies at Waha where capacity is operationally available,” the pipeline said.

Gas producers stand warned to count on facing determined environmental resistance every step of the way if the British Columbia and federal governments press ahead on plans to end a 33-year-old ban against drilling in the offshore of the Canadian West Coast.

Gas producers stand warned to count on facing determined environmental resistance every step of the way if the British Columbia and federal governments press ahead on plans to end a 33-year-old ban against drilling in the offshore of the Canadian West Coast.

Don’t be fooled by the 269 Bcf (26%) gas storage surplus compared to the five-year average of working gas levels, analysts at Raymond James & Associates warned in an equity research note last week. The gas market is tighter than those numbers would suggest, and “weather-disguised tightness should begin to show up soon.”

Don’t be fooled by the 227 Bcf (22%) gas storage surplus compared to the five-year average of working gas levels, analysts at Raymond James & Associates warned in an equity research note on Monday. The gas market is tighter than those numbers would suggest and the “weather-disguised tightness should begin to show up soon.”