Natural gas pipeline disruptions and constraints across the West appear to be on the verge of becoming history as conduits across the region return to normal operating pressure.
In addition to Southern California Gas Co. lines returning to operation, Enbridge's Westcoast pipeline was approved to return to full operating pressure on Nov. 28 by the Canada Energy Regulator. The company lifted its force majeure on the line the following day and reported flows on the T-South natural gas system should be 1,869,637 gigajoules as of Dec. 6.
Western natural gas prices fell as much as $2.38 in Nov. 26 to Dec. 5 trading. Sumas natural gas dropped the most, down $2.38 to $2.88/MMBtu by Dec. 5. Also notable was SoCal CityGate's $1.17 loss in value. El Paso-Permian Basin gas was the exception, adding 39 cents to reach $1.50/MMBtu.
Western natural gas prices ranged from $1.50/MMBtu at El Paso-Permian to $4.81/MMBtu at SoCal CityGate by the end of the holiday-affected trading period.
The U.S. Energy Information Administration attributed the price drops in California to decreased demand in the region. Demand had been high through the holiday weekend, prompting withdrawals from the Aliso Canyon natural gas storage field.
A total of 7 Bcf of natural gas was withdrawn in the Pacific region, bringing the amount in storage to 286 Bcf. This is 13 percent greater than a year ago, but 10.6 percent less than the five-year average of 320 Bcf, according to the EIA.
Nationally, working gas in storage was 3,591 Bcf as of Nov. 29, according to the EIA. This is a net decrease of 19 Bcf compared with the previous week.
Peak power prices in the West dropped between $1.30 and $13.75 in Nov. 27 to Dec. 5 trading. Mid-Columbia lost the most, down $13.75 to $31.95/MWh.
Western off-peak power also dipped in trading, dropping between $2.80 and $5.20. Mid-C lost the most, sinking $5.20 to $24.50/MWh. By Dec. 5, nighttime prices ranged from $24.50/MWh at Mid-C to $37.45/MWh at South of Path 15.
California Independent System Operator demand reached 29,270 MW Dec. 4, which should be the week's high. The grid operator's Daily Renewables output data is currently not available.
In November, the average high peak price at Henry Hub was $2.84/MMBtu, $1.88 less than in 2018 (see chart). That month, Western natural gas hub prices dropped more than $2 compared with the prior year, when prices were roughly $6/MMBtu. SoCal Border natural gas fell the most year over year, losing $2.80 to end up at $3.94/MMBtu.
Likewise, average Western power prices in the month were significantly lower compared with 2018. Values lost between $6.50 and as much as $23.25. California-Oregon Border fell the most year over year, down $23.25 to $46.75/MWh.