Posted on 10/26/2022 10:50:47 AM PDT by Cronos
While U.S. natural gas futures gained more than 4% on Monday, natural gas in the Waha part of the Permian Basin was falling and trading close to zero, traders told Bloomberg on Monday.
Flourishing natural gas production in the Permian has swamped pipelines, putting an undue burden on takeaway capacity, resulting in an oversupply situation that has caused natural gas prices to sag to as low as 20 cents, traders have reported, and up to 70 cents per MMBTU.
That compares with overall U.S. natural gas futures that are trading at more than $5 per MMBTU. Meanwhile, Europe’s nat gas prices are upwards of $25 per MMBTU. U.S. natural gas futures were up on Monday as hopes that several LNG plants were expected to come back online soon after weeks of maintenance, including Cove Point LNG and Freeport. Those prices were as high as $8 per MMBtu in September.
scheduled maintenance for Gulf Coast pipeline systems continue to dampen exports for Waha. Kinder Morgan is conducting maintenance at its Gulf Coast Express Pipeline beginning on October 25 at its Rankin, Devils River, and Big Wells Compressor Station. KMI expects the volumes to be reduced to 1,325,000 on Tuesday and Wednesday, and to 1,125,000 on Thursday and Friday. KMI’s EL Paso Natural Gas Company is expected has had a rash of maintenance performed on multiple lines since the beginning of October.
U.S. natural gas production was up last week, and the warmer weather has added to U.S. storage inventories.
Waha is the key natural gas pricing point for Mexico.
The Permian basin has been plagued by takeaway capacity constraints, “making the region more susceptible to sudden gluts and price volatility,” Campbell Faulkner, chief data analyst at OTC Global Holdings LP, told Bloomberg.
(Excerpt) Read more at oilprice.com ...
That’s the price pretty much at the well.
Getting that gas to New England with our current pipeline system, is where the real costs are added on to the price.
So I won’t have to sell my first-born to heat the house this winter?
Does anyone have a spare natural gas liquification facility and a few thousand cryogenic tanks?
Anyone have a stock symbol for some of this Natural gas?
That’s just the Permian Basin and old news, been vacillating like that for 3 years. It’s a storage/pipeline issue. I have mineral rights in the Texas Barnett shale (a much larger production area) and it is not having that problem. Distributions have dropped some but are still very good.
Colonial pipeline attack was never resolved. They just paid the ransomware. If perpetrators are not found and prosecuted, these things are bound to happen again.
Maybe if you live in Midland.
Biden aims to shutter largest oil field in U.S. amid record-high gas prices [Permian Basin, TX]
https://freerepublic.com/focus/f-bloggers/4076653/posts
Not for long! Joe’s going to shut it down.
Haven’t detected any gas aroma over Dominion’s Fink-Kennedy/Lost Creek storage pool in quite some time. Used to be a normal condition while driving on I-79 South of Clarksburg, WV
“Anyone have a stock symbol “
Futures, not stock.
“Does anyone have a spare natural gas liquification facility and a few thousand cryogenic tanks?”
You can’t get it to the facilties. “... pipelines are swamped ...”
OK Just checking because sometimes I buy USO for oil. Thanks
Wow. Talk about volatility. From $.20 to $25 seems like the sort of spread that would attract the oil business entrepreneurs.
> Maybe if you live in Midland.
surely there’s a gas-to-liquids solution that can be installed in the field close to the wellhead. I needs my diesel!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.