Thursday’s EIA report (week ended 30 Aug) – EA Final Estimate: +81 bcf
- We forecast Thursday’s EIA report will show an injection of 81 bcf. The 21 bcf w/w jump in the injection rate is due to a 4.0 bcf/d w/w drop in total demand, led by a 5.1 bcf/d w/w fall in power burn. National population-weighted CDDs plunged by 30% w/w despite some pockets of heat, including high temperatures in California, which pushed the Pacific into a net withdrawal for the week. Industrial gas demand also declined w/w, by 0.4 bcf/d, due to a slowdown associated with the long holiday weekend. LNG feedgas demand was able to offset some of the fall from other sectors, rising by 1.4 bcf/d w/w in the first full week of flows to Sabine Pass this August.
- Total supply dipped by 0.9 bcf/d w/w, as both total Lower 48 output (-0.2 bcf/d w/w) and net imports from Canada (-0,7 bcf/d w/w) were lower.
Next Thursday’s report (week ending 6 Sep) – EA Estimate: +92 bcf
- We forecast the current week will see an injection of 92 bcf, as demand falls further to fuel higher injections w/w. Industrial demand will fall by a further 1.0 bcf/d w/w this week due to the holiday on Monday. We expect power burn to be stable w/w at 35.1 bcf/d, despite a projected 15% w/w increase in national pop-weighted CDDs. Hurricane Dorian will keep power burn constrained, as it is likely to cause demand destruction when it makes landfall in the Southeast mid-week.
- We project LNG feedgas demand will inch lower by 0.1 bcf/d w/w to 6.4 bcf/d. Intake at Sabine Pass is set to fall by 0.3 bcf/d w/w, as it appears train 5 at the facility is currently ramping down before ceasing operations for scheduled maintenance late in the week. Total feedgas demand will be supported by higher volumes at Freeport LNG, which loaded its first cargo on 31 August.
- Production is on track to grow by 0.2 bcf/d w/w. Appalachia gains of 0.3 bcf/d w/w are leading the uptick, as the region saw service restored to TETCO’s 30-inch line on 2 September, following the 26 August completion of repairs to the parallel Line 25. Both pipes were damaged in a 1 August explosion near Danville, Kentucky, and 0.8 bcf/d of 1.5 bcf/d in capacity has now been restored.
- Elsewhere in the Lower 48, Bakken receipts topped 2.0 bcf/d for the first time ever on 30 August and are set to grow by 0.1 bcf/d w/w. Permian output is moving the other way and is on pace to decline by 0.2 bcf/d w/w due to a 30-31 August force majeure on El Paso Natural Gas Line 2000.
- There is a chance that the EIA report next week will show a reclassification of gas stocks. The Blue Lake Storage facility in Michigan reported a 3 September inventory reclassification of close to 15 bcf as it shifted volumes from base gas to working gas.
|Fig 1: Regional flows and fundamentals model, bcf|
|Source: Energy Aspects|
|Fig 2: Balance forecasts, bcf/d|
|Source: Energy Aspects|