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Evaporating demand brings Transco Zone 6 spot prices lower YOY

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Evaporating demand brings Transco Zone 6 spot prices lower YOY

Inspite of a drop in supply, TranscontinentalGas Pipe Line Co. LLC Zone 6 off-system deliveries tumbled morethan 0.5 Bcf/d to bring the area's spot natural gas prices below $1.50/MMBtuthe week ended April 26.

Duringthe week, nominations at delivery points along the pipeline averaged 7.71Bcf/d, down 2.8% versus the year-ago week, while nominations for deliveries onto the pipeline fell 5.6% to 8.04 Bcf/d.

Off-systemdeliveries dropped 12.1% to 2.51 Bcf/d, while power-sector consumption jumped25.7% to 2.22 Bcf/d, more than offsetting an 8.7% drop in residential andcommercial deliveries, which fell to 2.41 Bcf/d. Net injections into storagedeclined 22.9% to 435,250 Dth/d.

On thesupply side, a 123,590 Dth/d increase in receipts from interconnectedinterstate and intrastate pipelines failed to offset a 603,569 Dth/d decline innet receipts from the upstream and midstream sectors, leading to a net decreasein supply year over year.

Duringthe week, deliveries in Zones 4, 5 and 6 accounted for 78.8% of system demand,while receipts in Zones 3, 4 and 6 accounted for 85.5% of supply coming on tothe system. Alone, Zone 6 accounted for 40.2% and 51.2% of the week's averagesupply and demand, respectively.

Zone3 saw the week's average supply decline 7.5% to 736,641 Dth/d, even as receiptsfrom interconnected pipelines climbed 8.3% to 530,704 Dth/d, led by asubstantial increase in flows from ANRPipeline Co.

Duringthe week, Zone 3 spot natural gas prices averaged $1.855/MMBtu, down 26.7% fromthe year-ago level of $2.532/MMBtu.

AtZone 4, flows from interconnections with other pipelines held nearly flat yearover year, as increases in flows at GulfSouth Pipeline Co. LP, MidcontinentExpress Pipeline LLC and SouthcrossMississippi Pipeline LP nearly offset a decline in flows fromTennessee Gas Pipeline Co.to bring supply from the interstate and intrastate system 0.9% lower year overyear to 2.01 Bcf/d.

Zone4 off-system deliveries climbed more than eight-fold to 189,104 Dth/d, drivenprimarily by a 179,971 Dth/d increase in flows to .

Spotprices in the zone were down 27% year over year to an average of $1.861/MMBtu,a 0.6-cent premium to Zone 3.

Similarly,spot prices in Zone 5 averaged $1.927/MMBtu, a 25.5% decline from the year-agoweek, but a 6.6-cent premium to Zone 4.

Off-systemdeliveries in the zone climbed 108.3% year over year to 330,266 Dth/d, drivenlargely by a 108,738 Dth/d increase in deliveries to the Elba Express pipeline.

Residentialand commercial demand in Zone 5 climbed 8.3% to 744,772 Dth/d, led by increaseddeliveries to the City of Lexington, N.C.

TranscoZone 6 saw the lowest spot natural gas prices along the pipeline as pricesdeclined versus the year-ago week. At $1.454/MMBtu and $1.466/MMBtu,respectively, for Zone 6 non-NY and Zone 6 NY, average spot prices were down36.5% and 36.3%, respectively, below the year-ago week.

Thedrop in the zone's spot prices comes with a 14.3% drop in demand to 3.1 Bcf/d,and in spite of a 4.7% and 13.5% respective decline in receipts from themidstream sector and interstate pipelines.

led the drop in midstream deliveries to Transco, which would have been nearlyoffset by increased flows from WilliamsField Services Co. LLC were it not for declines at other gatheringsystems.

Meanwhile,the flows at the largest interconnections with interstate pipelines serving thezone fell to bring the region's interstate natural gas supply 250,055 Dth/dlower to 1.6 Bcf/d.

Leadingthe drop in Zone 6 demand was a 39% drop in off-system deliveries, the bulk ofwhich was a 390,923 Dth/d drop in flows to interconnections with

Onbalance, Zone 6 deliveries to local distribution companies, or LDCs, dropped17.9%, led by a 139,829 Dth/d decrease in flows to

Nearlyall deliveries to power generators took place in Zones 4, 5 and 6, with Zones 4and 5 together accounting for 73% of the week's average flows to the powersector, and Zone 6 accounting for the bulk of the remainder. Total systemdeliveries to the power sector climbed 25.7% to 2.22 Bcf/d, as deliveries inZone 4 and Zone 5 climbed 11% and 6.9%, respectively. Zone 6 deliveries to thepower sector climbed 131.1% to 588,240 Dth/d.

Marketprices and included industry data are current as of the time of publication andare subject to change. For more detailed market data, including power, natural gas and coal index prices, as well as forwards and futures, visit our energy commodities pages. To view operational statistics oninterstate natural gas pipelines, go to our Pipeline Summary Page. To view natural gas operational flow datafor receipt or delivery points, go to our Operational Capacity by Point Page.