On the production front, Genscape Inc. said it expects slight rebounds in production for the balance of this current week as a handful of Northeast and Rockies maintenance events wind down. On the demand side, it expects a moderate retreat in consumption due to most Midwest and Eastern demand market temperatures easing from early week highs.
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WTI briefly turned positive after energy information provider Genscape said crude inventories at the key Cushing, Oklahoma hub were expected to have dropped by 2.3 million barrels in the week since Tuesday, traders said, alleviating some concerns that surging U.S. production would outstrip demand.
For Wednesday’s gas day, “nominated deliveries to Sabine have dropped to 2.34 Bcf/d, about 0.51 Bcf/d below weekend levels,” Genscape said. Weekend volumes were up at 2.88 Bcf/d, a recovery of about 0.7 Bcf/d from the prior 30 days when volumes were suppressed due to the weekslong shutdown of Train 3 Genscape cameras were able to detect the restart of Train 3 well ahead of nominations data as well.
Algonquin Gas Transmission on Tuesday released a notice delaying its Southeast compressor station maintenance to Thursday (June 21) from Wednesday (June 19). The event could cut up to 300 MMcf/d of mainline flows, and the convergence of the event, cooling demand and an operational flow order currently in effect would have increased New England price volatility, Genscape Inc said. “Less heat actualizing and the delay of the event caused AGT basis to drop 9 cents” in Monday’s trading, “but it still remained above June’s average price,” Genscape natural gas analyst Josh Garcia said.
Genscape Inc. analysts Vanessa Witte and Colette Breshears said in a note to clients on Monday the firm conducted a flyover of the incident site last Friday. Photos show scorched earth and construction crews working in an area of dense forest where the explosion occurred. Photos showed crews have unearthed “several weld sections.”
Spot power skyrocketed to $576.57 a megawatt-hour between 4 p.m. and 5 p.m. local time. That was the highest average for the period since August 2016, according to Genscape Inc. data compiled by Bloomberg. “Expensive generation had to be dispatched in the areas south of that line,” said Michael DuBois, a power market analyst at Genscape.
Total pipeline, rail and local refining capacity from the Permian Basin oilfield in March was 3.175 million barrels per day (bpd), according to energy intelligence service Genscape, just shy of the oilfield’s roughly 3.3 million bpd output in June.
This should contribute to a bit of Algonquin volatility: an operational flow order is in effect for the market as the heat coincides with planned maintenance beginning Tuesday that would reduce flows through Algonquin Gas Transmission’s Southeast compressor station by 0.3 Bcf/d, Genscape senior natural gas analyst Rick Margolin said.
“This station has flowed an average of 164 MMcf/d in the past month. Cutting these flows will likely require rerouting some gas to flow west through NWPL’s Plymouth North Constraint point,” Genscape natural gas analyst Joe Bernardi said.
On Wednesday, energy data provider Genscape said its infrared imagery of the facility picked up heat signatures that indicate Sabine Train 3, which had not been operating since May 16 due to suspected maintenance, started returning to service Tuesday night.
Among them were points in the Permian Basin, where a revision to the El Paso Natural Gas maintenance schedule led to a cut of more than 200 MMcf/d of flows through the Waha GE constraint point in West Texas, according to Genscape Inc. A separate meter replacement event that began Tuesday had its associated operating capacity reduction revised, changing the operating capacity limit to 152 MMcf/d from 272 MMcf/d. This point averaged 350 MMcf/d of flows in the previous month, Genscape analyst Joe Bernardi said.
In other news, the liquefied natural gas (LNG) export terminal in Georgia, Elba Island LNG, should be approaching initial operations, according to a standard liquefaction commissioning schedule, which typically accounts for about three months prior to commercial service, Genscape said.