Outflows of natural gas have been strong recently, and they stand to strengthen further as new capacity becomes available. Natural gas outflows from the Permian Basin were up last week, with lower outflows to the North, offset by higher outflows to the West, East and Mexico. Last week, outflows to the East averaged 13.2 Bcf/d, up 0.1 Bcf/d week-on-week, as seen in the orange line in the chart below. Outflows to the West averaged 2.6 Bcf/d, also up 0.1 Bcf/d week-on-week. Outflows to the North averaged 1.8 Bcf/d, down 0.1 Bcf/d week-on-week, with slightly lower flows on ONEOK, El Paso towards the Midcontinent and Northern Natural. Outflows to Mexico averaged 2 Bcf/d, up 0.1 Bcf/d week-on-week. Outflows to Mexico have been very strong this summer, flowing near the historic max for an extended period of time rather than only during the ultra-peak season, which typically happens in late summer. The price of natural gas in the Permian continues to strengthen, as Waha basis to Henry Hub narrowed to just minus $0.55/MMBtu last week, according to Bloomberg data. This is the narrowest basis has been since December 2024.
Source: RBN NATGAS Permian, Wood Mackenzie
Narrower basis has been abetted by the expansion of outbound capacity. On its third quarter earnings call, Kinder Morgan confirmed that the Gulf Coast Express expansion was placed into full service on June 23 and also said that the 570 MMcf/d expansion was full almost immediately once it was online. The next Permian expansion is around the corner, Energy Transfer’s Hugh Brinson potentially already has some in-basin capacity online or coming soon, with Phase 1 (1.5 Bcf/d) expected this quarter and then Phase 2 (0.7 Bcf/d) next year. WhiteWater Midstream and Targa Resources’ Blackcomb Pipeline (2.5 Bcf/d) is also expected to begin service this quarter. For more on the Permian pipeline buildout, see the recent RBN blog, Open The Door.
