trending Market Intelligence /marketintelligence/en/news-insights/trending/_VCkPspZUCNaNWcaDNkqpA2 content esgSubNav
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us
In This List

Decreased Algonquin utilization keeps spot gas prices anchored

Blog

Essential Energy Insights - February 2021

Blog

Message in a (Word)Cloud

Six trends shaping the industries and sectors we cover in 2021

Six trends shaping the industries and sectors we cover in 2021


Decreased Algonquin utilization keeps spot gas prices anchored

Diminishedsupply and demand in the AlgonquinGas Transmission LLC system during the week ended April 5 drovepipeline utilization lower year on year, keeping spot natural gas pricesdeflated to less than half of the year-ago level.

Duringthe week, flows at Millennium Mainline averaged 1.28 Bcf/d for a utilizationrate of 82.7%, which is below both the April 2015 average of 84.1% and the prior-winteraverage of 94.7%. Utilization rates at the Southeast and Stony Point compressorstations were at 83.1% and 93.3%, respectively, against the average of 93.6%and 94.5% in the previous winter.

at delivery pointsalong the system during the review week were down 5.3% versus the year-agolevel at 2.25 Bcf/d, while nominations at receipt points that averaged at 2.22Bcf/d were 7.3% lower year on year.

SNL Image

Althoughdemand levels climbed toward the end of the report period to drive a late-weekboost in spot natural gas values at Algon Gates, overall spot price activity atthe hub remained weak. Spot gas pricing reached an index as high as$5.750/MMBtu on April 5, but ultimately averaged at $2.300/MMBtu over thecourse of the review week, reflecting a 52.0% decline from the prior-year level.

SNL Image

Adrop in power-sector demand and a small reduction in deliveries tointerconnected pipelines undermined an uptick in residential and commercialdemand, bringing pipeline utilization below historical averages.

Together,flows to power plants and interconnected pipelines accounted for 58.6% of theweek's total average demand. Power-sector demand dipped by 30.3% from theyear-ago level to 296,975 Dth/d and off-system demand eased by 0.3% year onyear to 1.02 Bcf/d, as LDC demand increased by 0.9% over the same period to929,591 Dth/d.

At703,265 Dth/d and 315,054 Dth/d, respectively, nearly all of the week'soff-system demand flowed into interconnections with andIroquois Gas Transmission SystemLP, with Texas Eastern logging a 6,612 Dth/d gain versus the yearago in deliveries from Algonquin and Iroquois notching a 4,744 Dth/dyear-over-year decline in supply from Algonquin. Tennessee Gas Pipeline Co. saw Algonquin gas flowsaverage at 6,032 Dth/d, down 2,166 Dth/d from the same time last year.

LDCdemand during the week in review was thoroughly mixed but higher overall thanin the year-ago period, with Orangeand Rockland Utilities Inc., Connecticut Natural Gas Corp. and leading the increase.

Only12,709 Dth/d of LNG supply found its way on to the system during the reportperiod, as interconnections with Tennessee Gas, and TexasEastern met 93.8% of the deliveries to Algonquin. Tennessee Gas saw Algonquingas flows fall by 68,244 Dth/d from the prior-year level to 978,785 Dth/d andMillennium Pipeline saw deliveries to Algonquin drop by 228,394 Dth/d over thesame period to 594,715 Dth/d, as Texas Eastern posted an 86,038 Dth/dyear-on-year increase in Algonquin deliveries to 501,062 Dth/d.

SNL Image

Beginning April 1, NAESBmandated that pipelines add an extra nomination cycle to the gas day thatchanges how shippers schedule flows on pipelines. As a result, there are slightvariations in how nomination cycles are defined prior to that date.

Market prices and includedindustry data are current as of the time of publication and are subject tochange. For more detailed market data, including power, natural gas and coal index prices, as well as forwards and futures, visit our CommoditiesPages. To view operational statistics on interstate natural gas pipelines, goto our Pipeline Summary Page. To viewnatural gas operational flow data for receipt or delivery points, go to our Operational Capacity by Point Page.