Full Title: Too Much of a Good Thing: What Record Storage Would Mean for 2015/2016
Author(s): Platts McGraw Hill Financial
Publisher(s): Platts McGraw Hill Financial
Publication Date: 08/2015

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Description (excerpt):

Not much stands in the way of US gas storage inventories reaching record high levels this fall of about 4.0 Tcf, and that strong likelihood points to a winter of relatively weak gas prices, perhaps carrying deep into 2016. Without a substantial increase in the pace of US gas demand growth from power generation or a major slow-down in US gas production growth, storage levels are likely to hit extreme highs, leading to operational constraints and deeply depressed prices in some regions of the country this fall.

The Energy Information Administration (EIA) currently estimates total US working gas design capacity from the 395 active storage fields at more than 4.6 Tcf and estimates non-coincident peak storage capacity at more than 4.3 Tcf [1]. This indicates that there should be plenty of space available for anticipated volumes to find a home this injection season. However, when the storage fill trajectory is examined by region, the refill rate shows a potential for operational challenges in some areas. Storage capacity limits could easily be reached at fields in several regions this summer, while fields in other regions, such as the Rockies, are likely to have ample available capacity.