The completion of Matterhorn Express was widely expected to relieve the outflow constraints that made Waha natural gas prices negative over much of 2024. However, since Matterhorn first began reporting flows on October 1, Waha has been negative more often than not as other factors kept a lid on Permian outflows. Nevertheless, for the most recent week, Waha has flipped back to positive pricing. Outright Waha cash prices averaged $1.56/MMBtu last week, up $2.00/MMBtu week-on-week according to data from Natural Gas Intelligence (NGI). This is the highest that prices in the basin have been since January.
Featured Articles
- Blog
Already Gone - Is the Permian Basin Already Out of Natural Gas Takeaway Capacity?
After a record run of negative pricing last spring and summer, the Permian Basin collectively cheered as WhiteWater’s Matterhorn Express pipeline began flowing last October, bringing much-needed takeaway capacity to the area. Cash prices at the Waha Hub rebounded and the basin had a relatively uneventful winter, but prices began dropping in early March and have once again traded below zero for most of the past few weeks. This has taken the market somewhat by surprise, as many expected the impact of Matterhorn’s startup to last more than a few months. Prices jumped back above zero on Wednesday and above $1/MMBtu on Thursday, but with major pipeline maintenance coming next week, any relief is likely to be short lived. In today’s RBN blog, we’ll look at what’s driving the recent run of negative pricing in the Permian Basin and what it means until additional infrastructure comes online next year.
- Analyst Insight
Waha Natural Gas Cash Basis Surges as Permian Outflows Grow
Waha natural gas prices have surged upward in the past week, as outflows from the Permian Basin are strong and Permian production remains at record highs.
- Blog
King of Pain - Waha Price Collapse Signals Worsening Gas Supply Glut in the Permian
The U.S. natural gas market last week was again reminded of the hair-trigger conditions that Permian producers and marketers are operating under — with gas production pushing against available takeaway capacity, all it takes is an otherwise minor/routine maintenance event on even one West Texas takeaway pipeline to send regional gas prices spiraling into negative territory. Waha Hub gas prices last week collapsed to their lowest level ever, with intraday trades even going negative — meaning some had to pay the market to take their gas. This wasn’t the first time that’s happened in the Permian — a similar event occurred in late November 2018 — but it was the worst to date and signals a heightened supply glut in the region, at least until the first new takeaway pipeline comes online in the fourth quarter of this year. Today, we explain the recent price weakness in West Texas and implications for Permian basis in 2019.
