First Look: Trans Mountain pipeline expansion to start operations
May 01, 2024
Oil is trading sharply lower to $80.85 as prices continue to move lower
The API forecasts a storage build of 4.9 MMBbls, which, if confirmed by the EIA would be the fifth storage build in the past six weeks
The dollar is trading higher, which can weigh on crude prices, and equities are trading lower
Trans Mountain pipeline expansion to start operations (Reuters)
After 12 years of delays and cost overruns, the nearly $25 billion pipeline is set to begin shipping oil today from Alberta to Vancouver for export overseas
The expansion increased capacity on the existing Trans Mountain pipeline from 300 MBbl/d to 890 MBbl/d and will primarily ship heavy crude
The original line will continue to ship mostly light crude to refineries in Washington state and British Columbia
The expansion of pipeline egress out of Canada should support WCS differentials and lower the probability of major price blowouts, as seen in the past
Natural gas prices trade lower as LNG maintenance curbs demand for feedgas and looming storage surplus
June ’24 Henry Hub is down 6.5c this morning to trade around $1.926 /MMBtu
The Summer ’24 strip is down 1.5c to $2.329 and Winter ‘24/’25 strip is down 1.8c to $3.411
Today's Euro Ensemble forecasts a significant cooldown across all regions, especially a 10-degree drop in the Northeast for the 11-15 day period, with overall below-normal temperatures persisting
Equitrans projects completion of Mountain Valley pipeline by May 31 (S&P Global, Criterion)
Mountain Valley pipeline, with less than one mile left to install the 304-mile route as of April 28, is expected to start final commissioning activities around May 31, reported Equitrans in its 1Q earnings report
Furthermore, MVP Southgate Expansion aims for completion in June 2028 and will extend 31 miles, supported by 550,000 Dth/d in firm commitments
OVC Expansion began interim service on April 1, 2024, with full service starting May 1, 2024, adding 350 MMcf/d capacity across PA, WV, and OH
Additionally, EQT's 1Q24 production curtailments of 1 Bcf/d, significantly impacting Equitrans assets, are expected to continue through May 2024, with potential further curtailments throughout the year
DT Midstream reports 1Q24 earnings, LEAP Phase 3 expected online in 3Q24 rather than 4Q24 (Criterion)
In 1Q 2024, DT Midstream's Haynesville system throughput declined to 1.52 Bcf/d, marking the lowest level in the past year; Appalachian assets slightly increased to 1.54 Bcf/d
The company guides production growth from both Haynesville and Appalachian basins to increase from 49 Bcf/d in 2023 to 67 Bcf/d by 2033
The 0.2 Bcf/d LEAP Phase 3 expansion in Louisiana is ahead of schedule, set to enhance system capacity to 1.9 Bcf/d by 3Q24, earlier than the previously expected 4Q24; plans for Phase 4 aim to add an additional 200-400 MMcf/d in 2025/2026
DT also plans to connect Stonewall Gas Gathering assets to the Mountain Valley Pipeline with a new interconnect in the 1H 2026, supporting a total firm capacity expansion of 350 MMcf/d in the Appalachian Basin
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