Optimism around the restart of the Freeport LNG terminal had natural gas markets moving higher in choppy trade through midday Tuesday.
Here’s the latest:
- August Nymex natural gas futures up 4.0 cents to $2.198/MMBtu as of 2:21 p.m. ET
- The Freeport liquefied natural gas facility was scheduled to receive about 370 MMcf of feed gas Tuesday, according to NGI’s U.S. LNG Export Flow Tracker.
The 2.1 Bcf/d Texas-based LNG terminal would be slowly restarting this week, with one train operating initially. The facility had power restored about a week after former Hurricane Beryl roared ashore on July 8. It was unclear when all three of its trains will return to full capacity.
U.S. LNG feed gas nominations were down about 0.5 Bcf/d to 10.7 Bcf/d for Tuesday, mainly on a nearly 0.6 Bcf/d drop in nominated flows to Cheniere Energy Inc.’s Corpus Christi LNG terminal, NGI data show.
- Lower 48 gas production for Tuesday down 2.3 Bcf/d day/day to 100 Bcf/d, Wood Mackenzie data show
Late-cycle nominations continued to add on to initial estimates for national gas output. Monday was revised higher to 102.3 Bcf/d from an initial 101.7 Bcf/d, the fourth straight day above 102 Bcf/d, according to Wood Mackenzie.
[In the Eye of the Storm: North American LNG project developers continue to grapple with the Biden administration's pause on non-FTA permits. Has the pause given impetus to other projects? How are Mexico LNG projects advancing? Tune in to hear from LNG industry analyst Sergio Chapa in the latest episode of NGI's Hub & Flow.]
Tuesday’s drop was mainly split between a 1 Bcf/d drop in the South Central region and 0.9 Bcf/d drop in the Mountain region. EBW Analytics Group analyst Eli Rubin cited a pipeline outage in the Permian Basin as the main driver of the decline.
El Paso Natural Gas Co. LLC (EPNG) would be conducting maintenance on Line 1300 from Belen to Laguna in New Mexico through Thursday, constraining flows at Caprock N by around 310,000 MMBtu/d, parent company Kinder Morgan Inc. said in a notice. Tuesday flows through Caprock N were down by two-thirds day/day to 175,000 MMBtu/d, according to Wood Mackenzie flow data.
EPNG also would be conducting tests at its Dumas compressor station until Thursday. Eastbound flows there were down about 103,000 MMBtu/d day/day.
- Natural gas cash prices averaged lower for Wednesday deliveries, according to NGI’s MidDay Price Alert
- Henry Hub down 4.0 cents to $2.080; Southeast Regional Avg. down 22.5 cents to $2.150
Weather-driven demand outlooks were little changed after midday updates to forecast models made mixed offsetting adjustments to upcoming days, NatGasWeather said. With the updates, the American model was still 2 cooling degree days hotter since Monday, the forecaster said.
Psychological support at $2, as well as cash prices, are technical markers for futures after the August contract traded down close to the NGI’s spot Henry Hub price.
“Natural gas prices are slightly higher today but likely due to oversold conditions after such strong selling yesterday that pushed prices to lows of the past few months,” NatGasWeather said.
