From the EIA Nat Gas Weekly

Basis differential narrows in Marcellus

At the Marcellus-shale area trading points, natural gas prices normally trade well below the Henry Hub national benchmark price because of the area's high gas production and limited pipeline takeaway capacity. The difference between the Marcellus pricing points and the Henry Hub, commonly referred to as the basis differential, has narrowed somewhat in recent months as new pipeline projects have come online and consumption of natural gas for heating has ramped up. While prices in the region are still very low, trading under $1.50 per million British thermal units (MMBtu), since November they have moved somewhat closer to the Henry Hub price. The price at Transco's Leidy Hub, for example, has averaged 89¢ below the Henry Hub since December 1. In July of 2015, on the other hand, the differential was much larger, averaging $1.65/MMBtu for the month.

In recent months, several new pipeline infrastructure projects and expansions have begun operation. For example, Texas Eastern Transmission Company's (Tetco) OPEN project added 550 million cubic feet (MMcf/d) of pipeline takeaway capacity out of Ohio and began full service in early November 2015. Other recent pipeline additions include Columbia Gas Pipeline's East Side Expansion, a 310-MMcf/d project that flows natural gas produced in Pennsylvania to Middle Atlantic markets; and Tennessee Gas Pipeline's Broad Run Flexibility Project, a 590-MMcf/d project originating in West Virginia that moves natural gas to the Gulf Coast states. Transco's Leidy Line project also began service in December, and flows gas from the Marcellus to Transco's main pipeline extending from Texas to New York. Bentek Energy noted that the effect of these new projects was somewhat limited in November, but as heating consumption increased later in 2015, Northeast production (which includes Marcellus) increased as well, setting records in December. Bentek estimated production from the Northeast came close to 22 Bcf/d in December.

http://www.eia.gov/naturalgas/weekly/

All those new pipelines will help.  And many more are either under construction or in planning stages like Mariner II   Soon the Dominion LNG export terminal will be online. Now if Shell would just make the Monaca cracker official.....

Views: 421

Reply to This

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service