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Natural Gas Weekly Update

for week ending May 15, 2019   |  Release date:  May 16, 2019   |  Next release:  May 23, 2019   |   Previous weeks


JUMP TO: In The News | Overview | Prices/Supply/Demand | Storage

In the News:

Pennsylvania’s power generation mix changes with natural gas production growth

On May 8, Exelon announced that the company would shut down its Three Mile Island Unit 1 nuclear facility in central Pennsylvania by September 30, 2019. In February 2019, the Three Mile Island facility provided 980 megawatts (MW), or 1.9%, of Pennsylvania’s nameplate capacity. In addition to Three Mile Island Unit 1, EIA’s electric generator inventory data indicate that two coal plants with a combined nameplate capacity of 1,845 MW have retired so far in 2019 in Pennsylvania. As retirements of coal and nuclear plants continue, natural gas-fired generation will continue to have a leading role in Pennsylvania’s electric generation mix.

Natural gas-fired electric generation in Pennsylvania has increased steadily in the past decade. EIA electricity generation data indicate that despite the fall in net electricity generation in Pennsylvannia, which has declined steadily by an average of 0.7% per year from 2010-18, natural gas-fired generation has increased both in share and in absolute terms.

In 2010, Pennsylvania generated 230 billion kilowatthours (kWh) of electricity. Almost half of this generation came from coal-fired facilities, followed by 34% from nuclear, 15% from natural gas and 3% from other sources such as petroleum, hydroelectric, wind, solar, biomass, and wood. In 2018, of the 215 billion kWh of electricity generated in Pennsylvania, 39% came from nuclear, 36% from natural gas, and 21% from coal, and 5% from other sources.

From 2010-2018, nuclear fired electric generation grew by 7% and provided an annual average of 36% of the generation mix annually on average. With the shutdown of the Three Mile Island facility, the remaining four nuclear facilities will account for 21% of Pennsylvania’s nameplate capacity.

Between 2010 and 2018, natural gas-fired electric generation rose by 128%, while coal-fired electric generation fell by 60%. Though electricity generation from other sources have increased, these other sources still account for a small share—about 3%–5% of Pennsylvania’s total generation mix.

The increase in natural gas-fired electric generation capacity in Pennsylvania has come with significant growth in the state’s natural gas production. Pennsylvania’s marketed natural gas production reached a new high of 18.6 billion cubic feet per day (Bcf/d) in February, a 2440% increase from February 2010, and a growth of 13% from a year ago. A decade ago, Pennsylvania marketed gas production accounted for just 1% of the total U.S. marketed natural gas production. Currently, Pennsylvania accounts for 19% of U.S marketed natural gas production.

Although 2,825 MW of coal-fired and nuclear generation capacity will be retired in 2019, Pennsylvania is adding new natural gas-fired generation capacity. From 2019–2022, in Pennsylviania, 17 new natural gas-fired plants will be in various stages of development, bringing 8,460 MW of nameplate capacity online by 2022.

Overview:

(For the week ending Wednesday, May 15, 2019)

  • Natural gas spot price movements were mixed this report week (Wednesday, May 8 to Wednesday, May 15). Henry Hub spot prices rose from $2.59 per million British thermal units (MMBtu) last Wednesday to $2.61/MMBtu yesterday.
  • At the New York Mercantile Exchange (Nymex), the price of the June 2019 contract decreased 1¢, from $2.610/MMBtu last Wednesday to $2.601/MMBtu yesterday. The price of the 12-month strip averaging June 2019 through May 2020 futures contracts declined 1¢ to $2.738/MMBtu.
  • Net injections to working gas totaled 106 billion cubic feet (Bcf) for the week ending May 10. Working natural gas stocks are 1,653 Bcf, which is 9% more than the year-ago level and 15% lower than the five-year (2014–18) average for this week.
  • The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 5¢, averaging $5.73/MMBtu for the week ending May 15. The price of ethane and natural gasoline fell by 2% and 1%, respectively. The price of propane, isobutane, and butane rose by 3%, 2%, and 1%, respectively.
  • According to Baker Hughes, for the week ending Tuesday, May 7, the natural gas rig count remained flat at 183. The number of oil-directed rigs fell by 2 to 805. The total rig count decreased by 2, and it now stands at 988.

more summary data

Prices/Supply/Demand:

Prices are mixed across the country with moderate temperatures. This report week (Wednesday, May 8 to Wednesday, May 15), Henry Hub spot prices stayed within a narrow range and rose 2¢ from $2.59/MMBtu last Wednesday to $2.61/MMBtu yesterday. Temperatures were cooler than normal across most of the country and warmer than normal in the Pacific Northwest. At the Chicago Citygate, prices decreased 4¢ from $2.37/MMBtu last Wednesday to $2.33/MMBtu yesterday.

California prices rise. Prices at PG&E Citygate in Northern California rose 20¢, up from $3.25/MMBtu last Wednesday to a weekly high of $3.45/MMBtu yesterday. Prices at SoCal Citygate increased 10¢ from $2.85/MMBtu last Wednesday to $2.95/MMBtu yesterday.

Northeast prices fall. At the Algonquin Citygate, which serves Boston-area consumers, prices went down 4¢ from $2.36/MMBtu last Wednesday to $2.32/MMBtu yesterday. At the Transcontinental Pipeline Zone 6 trading point for New York City, prices decreased 2¢ from $2.35/MMBtu last Wednesday to $2.33/MMBtu yesterday.

Tennessee Zone 4 Marcellus spot prices decreased 1¢ from $2.14/MMBtu last Wednesday to $2.13/MMBtu yesterday. Prices at Dominion South in southwest Pennsylvania rose 2¢ from $2.21/MMBtu last Wednesday to $2.23/MMBtu yesterday.

Permian Basin discount to Henry Hub narrows throughout the week, but still persists. Prices at the Waha Hub in West Texas, which is located near Permian Basin production activities, averaged a weekly low of $0.25/MMBtu last Wednesday, $2.34/MMBtu lower than Henry Hub prices. Yesterday, prices at the Waha Hub averaged $0.86/MMBtu, $1.75/MMBtu lower than Henry Hub prices.

Supply remains flat. According to data from PointLogic Energy, the average total supply of natural gas remained the same as in the previous report week, averaging 94.4 Bcf/d. Dry natural gas production remained constant week over week. Average net imports from Canada decreased by 4% from last week. Canadian production has been lower than normal in British Columbia and Alberta because spring breakup—when the rig count is temporarily reduced—has extended later into the season, according to Natural Gas Intelligence.

Demand rises week over week. Total U.S. consumption of natural gas rose by 1% compared with the previous report week, according to data from PointLogic Energy. Natural gas consumed for power generation declined by 3%, and industrial sector consumption increased by 1%. In the residential and commercial sectors, consumption increased by 9%. Natural gas exports to Mexico increased 3%.

U.S. liquefied natural gas (LNG) exports increase week over week. Eleven LNG vessels (seven from Sabine Pass, two from Cove Point, and two from Corpus Christi) with a combined LNG-carrying capacity of 38.0 Bcf departed the United States from May 9 to May 15, according to shipping data compiled by Bloomberg. Two vessels—one at Sabine Pass and one at Corpus Christi—were loading at their terminals on Wednesday.

According to Sempra Energy—the owner of the Cameron LNG facility in Hackberry, Louisiana—Train 1 has begun producing LNG and Sempra expects to load cargoes in the coming weeks.

Storage:

Net injections into storage totaled 106 Bcf for the week ending May 10, compared with the five-year (2014–18) average net injections of 89 Bcf and last year's net injections of 104 Bcf during the same week. Working gas stocks totaled 1,653 Bcf, which is 286 Bcf lower than the five-year average and 130 Bcf more than last year at this time.

According to The Desk survey of natural gas analysts, estimates of the weekly net change from working natural gas stocks ranged from net injections of 95 Bcf to 125 Bcf, with a median estimate of 106 Bcf.

More storage data and analysis can be found on the Natural Gas Storage Dashboard and the Weekly Natural Gas Storage Report.

See also:



Natural gas spot prices
Spot Prices ($/MMBtu)
Thu,
09-May
Fri,
10-May
Mon,
13-May
Tue,
14-May
Wed,
15-May
Henry Hub
2.56
2.57
2.64
2.63
2.61
New York
2.24
2.20
2.49
2.34
2.33
Chicago
2.35
2.36
2.43
2.41
2.33
Cal. Comp. Avg.*
2.49
2.37
2.58
2.67
2.50
Futures ($/MMBtu)
June contract
2.595
2.619
2.621
2.659
2.601
July contract
2.631
2.655
2.653
2.689
2.634
*Avg. of NGI's reported prices for: Malin, PG&E Citygate, and Southern California Border Avg.
Sources: Natural Gas Intelligence and CME Group as compiled by Bloomberg, L.P.
Natural gas futures prices
Natural gas liquids spot prices


U.S. natural gas supply - Gas Week: (5/9/19 - 5/15/19)
Average daily values (Bcf/d):
this week
last week
last year
Marketed production
100.5
100.2
90.6
Dry production
89.6
89.4
80.3
Net Canada imports
4.7
5.0
5.7
LNG pipeline deliveries
0.1
0.1
0.1
Total supply
94.4
94.4
86.1

Source: OPIS PointLogic Energy, an IHS Company
Note: LNG pipeline deliveries represent natural gas sendout from LNG import terminals.

U.S. natural gas consumption - Gas Week: (5/9/19 - 5/15/19)
Average daily values (Bcf/d):
this week
last week
last year
U.S. consumption
60.6
59.7
57.9
    Power
24.0
24.6
27.1
    Industrial
20.4
20.2
20.1
    Residential/commercial
16.2
14.9
10.7
Mexico exports
4.7
4.6
4.5
Pipeline fuel use/losses
6.0
5.9
5.5
LNG pipeline receipts
5.8
5.5
3.5
Total demand
77.0
75.8
71.3

Source: OPIS PointLogic Energy, an IHS Company
Note: LNG pipeline receipts represent pipeline deliveries to LNG export terminals.

Natural gas supply


Weekly natural gas rig count and average Henry Hub
Rigs
Tue, May 07, 2019
Change from
 
last week
last year
Oil rigs
805
-0.2%
-4.6%
Natural gas rigs
183
0.0%
-8.0%
Note: Excludes any miscellaneous rigs
Rig numbers by type
Tue, May 07, 2019
Change from
 
last week
last year
Vertical
45
-2.2%
-18.2%
Horizontal
872
-0.1%
-5.0%
Directional
71
0.0%
-1.4%
Source: Baker Hughes Inc.


Working gas in underground storage
Stocks
billion cubic feet (Bcf)
Region
2019-05-10
2019-05-03
change
East
330
299
31
Midwest
336
309
27
Mountain
 82
 78
4
Pacific
174
162
12
South Central
731
699
32
Total
1,653
1,547
106
Source: Form EIA-912, Weekly Underground Natural Gas Storage Report
Working gas in underground storage
Historical comparisons
Year ago
(5/10/18)
5-year average
(2014-2018)
Region
Stocks (Bcf)
% change
Stocks (Bcf)
% change
East
270
22.2
342
-3.5
Midwest
263
27.8
391
-14.1
Mountain
97
-15.5
126
-34.9
Pacific
203
-14.3
238
-26.9
South Central
689
6.1
842
-13.2
Total
1,523
8.5
1,939
-14.7
Source: Form EIA-912, Weekly Underground Natural Gas Storage Report


Temperature – heating & cooling degree days (week ending May 09)
 
HDD deviation from:
 
CDD deviation from:
Region
HDD Current
normal
last year
CDD Current
normal
last year
New England
79
-4
29
0
0
0
Middle Atlantic
53
-15
26
0
-1
-9
E N Central
66
-7
25
1
-4
0
W N Central
82
19
41
0
-7
-7
South Atlantic
3
-26
-2
55
27
6
E S Central
9
-17
-2
36
17
6
W S Central
5
-3
-6
47
5
14
Mountain
75
-2
28
12
-2
-9
Pacific
39
-8
27
1
-5
-5
United States
47
-7
20
19
5
0
Note: HDD = heating degree day; CDD = cooling degree day

Source: National Oceanic and Atmospheric Administration

Average temperature (°F)

7-day mean ending May 09, 2019

Mean Temperature (F) 7-Day Mean ending May 09, 2019

Source: National Oceanic and Atmospheric Administration

Deviation between average and normal (°F)

7-day mean ending May 09, 2019

Mean Temperature Anomaly (F) 7-Day Mean ending May 09, 2019

Source: National Oceanic and Atmospheric Administration