Natural Gas in Underground Storage

The weekly EIA Natural Gas Storage Report advised that there was a withdrawal of 163Bcf from Underground Storage for the week ending January 18th, 2019.

This is 10Bcf above the median forecast of a 153Bcf withdrawal, the average prediction of sector analysts and traders in the Dow Jones Newswires weekly survey. The withdrawal compares with -273Bcf last year and -185Bcf for the five-year average. Storage is 33Bcf above last year for the same week and 305Bcf below the 5-year average. Working gas in storage stands at 2,370Bcf. Read more ...

Natural Gas Pricing


As of 9:37AM CST, February 2018, (the prompt month) Natural Gas was trading at $3.08, -$0.40 from one week ago and the 1-Year Spread average was $2.95, -$0.05 from one week ago.

Crude Oil Pricing


As of 9:39AM CST, February, 2018, (the prompt month) Light, Sweet Crude on the NYMEX was at $52.82, +$1.32 from one week ago.

Crude Oil Inventory

US crude inventories increased by 8.0 million barrels to 445.0 million barrels for the week ended January 18th, according to data released yesterday morning by the US Department of Energy. Traders in the Reuters poll projected a decrease of 0.1 million barrels.

U.S. Rotary Rigs


U.S. Rotary Rigs drilling for natural gas were -4 at 198 for the week of January 18th. The number of rigs currently drilling for Natural Gas was +9 from last year. US Rigs drilling for oil were -21 at 852. There are 105 more rigs targeting oil than last year. Canadian rigs were +25 at 209 for the week. Rigs targeting oil remain at 81% of all US drilling activity.

Geopolitical


To stay below 1.5ºC, we must massively scale solar, wind and batteries (and hydrogen?) A new study by the University of Technology Sydney maps routes for massive decarbonization and 100% renewable energy to reach Paris Agreement goals. In North America, as the rest of the world, we must move quickly.

73 GW per year. That’s how much solar PV a new study led by Dr. Sven Teske of the Institute for Sustainable Futures at the University of Technology Sydney says that North America needs to put online each year until 2050 in order to meet the 1.5 degree scenario that was agreed upon by nations around the world in 2016.

That’s roughly seven times as much solar as was deployed in the United States last year, which makes up more than 80% of final energy demand in the region. But that is not all. Dr. Teske’s study says that North America will also need 4 GW of concentrating solar power plants, 22 GW of wind (mostly offshore). Not to mention 39 GW of hydrogen to gas capacity, and various other renewable energies ... (click here to read more)

Weather

The AccuWeather 1-5 day Outlook forecasts below-normal temps for the Central states, above-normal temps for the West Coast and New England and normal temps for the balance of the US. The 6-10 Day Outlook forecasts the Eastern 2/3 of the US at below-normal temps with the West at normal or above-normal temps. 

11-15 Day Outlook  forecasts below-normal temps for the Northeastern quarter of the US with the deep Southeast and all of the Western half of the country at normal or above-normal temps. The 30-day Outlook projects below-normal temps for the Eastern half of the US,  above-normal temps for West and normal temps for the Central States.

The 90-Day Outlook projects normal temps for the entire country, with the exception of the far Northwest, which is expected to be at above-normal temps and a section of the Southeast, which is projected to be below-normal. The Midwest is experiencing extreme cold with a relentless winter storm freezing roads and closing airports. The North-Central states are experiencing wind chill readings of over 40 degrees below zero.

Sustainability and Renewables


New Jersey-based Martin & Ottaway, together with industry partners, has formed a company aimed at  developing Wave Energy Converters using patented features expected to increase energy recovery rates by an order of magnitude over legacy WEC systems.

The company, SurfWEC, states it has broken through the barriers holding back wave energy recovery technologies from successfully and economically harnessing power from ocean waves. SurfWEC utilizes technology which “conquers the challenge of highly variable wave sizes that faced past ocean-based efforts by converting wavelength to wave height.”

SurfWEC is a novel WEC approach to wave energy conversion invented by M&O’s Mike Raftery. The  units are designed to create optimal surf waves offshore for WEC applications. By creating optimal surf waves with maximum steepness before breaking, SurfWEC units cause waves to input 100 times as much kinetic energy into surface floats as in typical offshore wave conditions. This is accomplished by enabling the surface floats to have average speeds 10 times faster than in typical offshore wave conditions ... (click here to read more)

This Week's Key Take-Away


Cold. Extreme cold. That is what has been driving the electricity markets. High usage of both natural gas and electricity have been under scrutiny nationally.

Texas' ERCOT grid is in a precarious situation due to the lack of new generation and the retirement of existing coal and natural gas generation plants. Two weeks ago, the Gibbons Creek Generation Station, a 470mW coal-driven generator used for peak weather events announced that it was closing. This is after the Texas Public Utilities Commission lowered the expected reserve margin from just above 9% to 7.4% through the coming summer. This means tighter available electricity this summer due to a lack of generators. The bad news- there are no new natural gas or nuclear generators under construction at this time in Texas, due to credit issues relating to the ROI of building new plants. If a new natural gas- driven generator was to be announced today, it would take approximately 36 months to be completed.

Wind and Solar utility-scale farms will continue to be built but much - if not all - of the new generation will be absorbed by economic growth.