Natural Gas Production Boom Has Pipeline Demand Exceeding Supply
Ottawa Citizen reports: Natural gas producers want more pipeline space than many midstream companies are offering and have oversubscribed to two new expansion projects in the last week. TransCanada Corp. announced Wednesday that natural gas producers had bid for more space on a new $2-billion expansion of its Nova pipeline system than was available. The expansion project will allow gas producers in northwestern Alberta and northeastern B.C. to move an additional 2.6 billion cubic feet of gas per day out of the field and into pricing hubs. It will also allow producers to send 400 million cf/d to markets in California, Nevada and the Pacific Northwest. Wednesday’s announcement marks the second time in a week that Calgary-based pipeliners announced demand for space on new lines had significantly outpaced what was being offered.
Natural Gas Prices Held Below Resistance, No Supply from Oil Trading
Economic Calendar reports: Natural gas was unable to regain the $3.00 per mBtu level on Wednesday with a sharp decline in oil prices tending to strengthen resistance levels. Natural gas prices consolidated just below $3.00 per mBtu in US trading on Tuesday. There was further speculation that long natural gas positions were being scaled back following the recent sharp decline in prices amid fears that stocks will increase sharply during the summer period. Oil prices were subjected to renewed selling pressure following the latest EIA inventories data and the selling pressure in crude also tended to hamper natural gas prices with no move to retake the $3.00 per mBtu level and consolidation around $2.96 late in the European session.