EIA NG STORAGE REPORT
| February 15, 2018
February 15, 2018
The EIA reported a -194 bcf withdrawal for the week ending February 8th, a 4 bcf stronger pull than our estimate and 8 bcf stronger pull than the Bloomberg median. What helped our estimate stay close to EIA’s reported figure this week was our Midwest regional model, which accurately predicted the larger than expected draw within that footprint (Figure 1). An updated version of the Midwest regional model covering the week ending today will be posted via ICE Chat and BBG tomorrow. While .....
EIA NG STORAGE REPORT
| February 08, 2018
February 8, 2018
Please note our extended U.S. and Canada tables covering the withdrawal season are included in the attachment. The EIA reported a -119 bcf withdrawal for the week ending February 1st, a 4 bcf stronger pull than both our estimate and the Bloomberg median. Salt domes posted another large counter seasonal injection this week, in line with our estimate of +15 bcf. This week’s injection puts salt inventories back within the 5-year range. While our model was spot on for the salt injections, the .....
EIA NG STORAGE REPORT
| February 01, 2018
February 1, 2018
Overall, the last few weeks helped (forced) us to update and recalibrate many guidelines and assumptions that were baked into our models. Based on current weather forecasts and recovery in salt dome inventories, now may be a good time to pick up the pieces and write the “lessons learned” handbook. On the supply side, the idea of virtual storage was tested. As expected, it failed to deliver under extreme conditions, and exacerbated the call on salt domes. Implementation and execution of virtual.....
EIA NG STORAGE REPORT
| January 25, 2018
January 25, 2018
Our argument over the past three weeks has been that the market had not been pricing in the risk of a cold February, more specifically the potential impact of a cold February on salt domes that were already on their path to historically low levels by mid-January. We believe that this week’s price action and corresponding salt dome injections mitigate that risk to a certain degree. We are also convinced that in addition to the geographical footprint of a possible cold front, the duration and dept.....
EIA NG STORAGE REPORT
| January 19, 2018
January 18, 2018
Over the past two weeks, we discussed the potential impact of a cold February on inventories and futures prices. We argued that heavy reliance on salt domes through the first half of January strained those high deliverability sources of supply, making late-winter deliverability profiles less robust, which in turned made the market more susceptible to price spikes in case of late-season cold. Today, we cover all North American inventories to see whether the market has alternative sources of suppl.....
EIA NG STORAGE REPORT
| January 12, 2018
January 11, 2018
The extent of mechanical failures freeze-offs cause may not be evident at first look. Unlike a simplistic flow/no-flow event, freeze-offs can be destructive to infrastructure and may require significant time and resources to recover from. Potential damages to pipes alone can range from cracked water pipes – which may cause an environmental nightmare – to natural gas hydrates breaking through a gas line. In last week’s report, we laid out a scenario about how a one standard deviation cold Febru.....
EIA NG STORAGE REPORT
| January 05, 2018
January 4, 2018
A one standard deviation colder than the 30-yr normal February – similar to the one in 2015 – could potentially draw salt domes to an all-time low of 31 bcf by March 8, compared to the minima of 54 bcf observed on March 7, 2014. Such an extreme level can be diverted via the supply side by a rapid fill of new pipeline capacity (namely Rover and Leach Xpress) with new production, or by incremental imports from Canada. If the supply side fails to balance the market, prices have to increase further .....
EIA NG STORAGE REPORT
| December 28, 2017
December 28, 2017
The EIA reported a -112 bcf withdrawal for the week ending December 21st, the reported volume was just 1 bcf lighter than our estimate and the Bloomberg median. While our headline estimate was close to the reported -113 bcf, the regional breakdown did not perform as expected, with the biggest misses in the Midwest and South Central canceling each other. We have been tracking season-to-date cumulative GWHDDs versus the six warmest and six coldest winters since the winter of 1970-71. The “perf.....
EIA NG STORAGE REPORT
| December 21, 2017
December 21, 2017
The EIA reported a -182 bcf withdrawal for the week ending December 14th, the total withdrawal was 3 bcf more than our estimate and 7 bcf more than the Bloomberg median of -175 bcf. The stronger than expected pulls in the Northeast were most likely due to a combination of cold weather and high export levels from the region. The regional balances suggest that export levels remained strong during the reference week, despite the cold weather. Price points tied to supply like TETCO M2 and Domi.....
EIA NG STORAGE REPORT
| December 14, 2017
December 14, 2017
The EIA reported a -69 bcf withdrawal for the week ending December 7th, this was 9 bcf stronger than our expectation and was 8 bcf stronger than the Bloomberg median. Almost all the error in our estimate this week was in the South Central region. Faulty assumptions around salt and non-salt dynamics and low visibility around non-salt nominations led our model to underestimate the extent of the large shift from injections to withdrawals in the South Central this week. The fact that non-salt st.....