Natural Gas

March 07, 2024

Platts proposes changes to Transco Zone 5 natural gas index methodology

Platts, part of S&P Global Commodity Insights, proposes to exclude Station 165 trades from the Transco, zone 5 delivered South daily (IGCHL00) and monthly (IGCHL03) indices. Platts also proposes to launch a new Transco, Station 165 daily and monthly index.

The proposed changes would take effect upon the commercial start-up of the Mountain Valley Pipeline (MVP) project, which is currently targeted for June 1, 2024. Changes to the Platts methodology for the monthly market would be effective trade date May 24, the first trading day of June bidweek, and for the daily market they would be effective trade date May 31 for flow date June 1.

This follows a consultation period where Platts gathered substantial feedback from market participants. The original consultation subscriber note can be found here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/010524-platts-seeks-feedback-on-transco-zone-5-south-natural-gas-index-methodology

The proposals result from extensive market feedback that continuing to include deliveries to the Station 165 pool in the Transco, zone 5 delivered South index would result in a disconnect in prices within the zone 5 delivered South market due to a capacity constraint south of compressor station 165.

The proposed change to the Transco, zone 5 delivered South methodology is as follows:

Existing Proposed
Transco, zone 5 delivered South (daily and monthly market) Deliveries from Transcontinental Gas Pipe Line on the 30-inch, 36-inch and 42-inch lines from the Georgia-South Carolina border up to and including Station 165 in Virginia. Deliveries from Transco north of Station 165 are not included. Transactions are also included in the Transco, zone 5 delivered index. Transco, zone 5 delivered South (daily and monthly market) Deliveries from Transcontinental Gas Pipe Line on the 30-inch, 36-inch and 42-inch lines from the Georgia-South Carolina border up to but not including Station 165 in Virginia. Transactions at Transco's Station 165 Zone 5 pooling point and deliveries from Transco north of Station 165 are not included. Transactions are also included in the Transco, zone 5 delivered index.

The proposed methodology for the new Transco, Station 165 location is as follows:

Transco, Station 165 (daily and monthly market) Transactions at Transcontinental Gas Pipe Line's Station 165 Zone 5 pooling point near the Virginia-North Carolina border in Pittsylvania County, Virginia. Transactions are also included in the Transco, zone 5 delivered index.

The methodology for the Transco, zone 5 delivered and Transco, zone 5 delivered North indices will not change.

Please send feedback, comments, or questions to AmericasGasPricing@spglobal.com and pricegroup@spglobal.com by April 5, 2024.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.