Lower 48 gas storage

Published at 18:09 29 Oct 2019 by . Last edited 19:32 30 Oct 2019.

This report includes our forecast for the next two EIA Weekly Natural Gas Storage Reports. We also include a sample of our weekly supply-demand balances, regional flow model, and our short-term data in the attached document. Our forecast record can be found on page 9.

Thursday’s EIA report (week ended 25 Oct) – EA Final Estimate: +85 bcf

  • We forecast Thursday’s EIA report will show an injection of 85 bcf, flat w/w. Total demand grew by 1.3 bcf/d w/w in a rare week that saw both more HDDs and CDDs w/w. The 10% w/w growth in gas-weighted HDDs (GWHDDs) gave res-com demand a 0.8 bcf/d w/w boost, while a smaller uptick in CDDs helped power burn edge up by 0.3 bcf/d w/w. LNG feedgas demand also increased w/w by 0.4 bcf/d.
  • Lower 48 production growth nearly matched that of total demand, rising by 1.1 bcf/d w/w. Appalachia and South Texas receipts each rose by 0.3 bcf/d w/w, with the Permian, Anadarko, Haynesville and DJ basins each adding another 0.1 bcf/d w/w.

Next Thursday’s report (week ending 1 Nov) – EA Estimate: +47 bcf

  • We forecast that the current week will see an injection of 47 bcf. This would leave US inventories with an end-October carryout of nearly 3.74 tcf.
  • Higher res-com demand w/w will drive the 38 bcf w/w decline in the injection rate. National GWHDDs are forecast to rise by 15% w/w, causing a 5.0 bcf/d w/w jump from the res-com sector. The cold is focussed in the Mountain West region, where low temperatures fell into the single digits Fahrenheit (more than 25°F below normal) amid snowstorms at the beginning of the week.
  • Lower 48 production is on pace for a stagnant week. Although Appalachia output is on pace for 0.2 bcf/d in w/w growth, declines of 0.1 bcf/d w/w each from the Gulf of Mexico and the San Juan will stymie any increase. Flows out of the San Juan were dented by an engine replacement at the Northwest Pipeline’s Vernal compressor station, which curtailed 0.2 bcf/d in flows between 22–26 October.
  • Even in a flat week for production, total supply is set to grow by 0.3 bcf/d thanks to an uptick in net imports from Canada. The increase results from a decline in US exports to Eastern Canada’s Dawn storage hub via the Vector Pipeline. US flows to Canada on Vector are down 0.3 bcf/d w/w, as Dawn’s inventories are up by 15 bcf y/y at 273 bcf, close to the facility’s maximum capacity of 279 bcf.
  • We forecast LNG feedgas flows will continue on their upward trajectory, rising by 0.3 bcf/d w/w. The increase will be driven by a 0.1 bcf/d gain in Cameron LNG’s intake as well as a 0.2 bcf/d w/w jump in flows to Freeport LNG. Freeport LNG loaded its first cargo in two weeks on 28 October.
Fig 1: Regional flows and fundamentals model, bcf
Source: Energy Aspects
Fig 2: Balance forecasts, bcf/d
Source: Energy Aspects

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