Natural gas markets in the U.S. Northwest have been in turmoil ever since a rupture on Enbridge’s BC Pipeline system over a month ago (on October 9) disrupted Canadian gas exports to Washington State at the Sumas border crossing point. Service on the affected line has been restored but at a reduced operating pressure for now, and Canadian gas deliveries to Sumas remain at about half of their pre-outage levels, creating supply shortages in the region. Spot natural gas prices at the Sumas, WA, trading hub have been volatile, soaring well above Henry Hub and rocketing to a record outright price of nearly $70/MMBtu late last week. The outage has reverberated across the Western U.S. gas market, sending regional prices reeling as gas flows adjusted to help offset supply shortages. Today, we examine the knock-on market effects of the outage on Western gas flows and prices, and potential implications for the winter gas market.
Before we get to the outage itself and its ongoing effects, we start with a brief overview of the BC Pipeline system and the surrounding infrastructure, as shown in Figure 1.
Figure 1. West Coast Pipelines and 2018 Basis Values (in $/MMBtu). Sources: RBN, NGI
Enbridge’s 2.9-Bcf/d BC Pipeline system (aka Westcoast Energy Pipeline, or WEP; dark green line on the map) comprises two parallel mainlines — 36-inch-diameter and 30-inch-diameter — that move Alberta and BC gas supply from northeastern British Columbia south to a 1.3-Bcf/d interconnect at the Huntingdon, BC/Sumas, WA, border crossing point (orange dot) with Williams’s Northwest Pipeline (NWPL; light orange system). From there, the gas is delivered to local distribution companies, gas-fired power generation plants, gas storage facilities, as well as for petroleum refining, primarily in Washington State but also some in Oregon and Idaho.
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About the song
"Chain Reaction" was written by the Bee Gees (who also sang back-up vocals on the recording) for Diana Ross' 1985 album, Eaten Alive. It was released as a single in November 1985, when it went to #1 on the UK Singles charts. The song stalled at #95 on the U.S Billboard Hot 100 chart but did well at dance clubs and went to #7 on the U.S. Billboard Dance Club Songs chart. A remixed version was released in early 1986 that made it to #66 on the U.S. Billboard Hot 100.
"Eaten Alive" was primarily written and produced by Bee Gee member Barry Gibb. The title track to the album was co-written and co-produced by Michael Jackson, who also sang on the track. The album reached #3 on the U.S. Billboard Dance Charts.
Diana Ross is an American singer, actress, and record producer. As the lead singer of the Motown group The Supremes, she helped them to achieve a record-setting twelve #1 singles on the U.S. Billboard Hot 100 charts, and helped them to become one of the most successful girl groups in history. She did 18 studio albums with The Supremes before leaving for a solo career in 1970. As a solo act, Ross has recorded 24 studio albums, 5 live albums, and has starred as a featured player in 5 major motion pictures. She has also made guest appearances on many television shows. She has won 7 AMAs, 1 Grammy Lifetime Achievement Award, 1 MTV Video Music Award, 1 Tony Award, and is listed in the Guinness Book of World Records as the most successful female music artist in history. Ross was awarded the Presidential Medal of Freedom in 2016 and has two stars on the Hollywood Walk of Fame, one as a solo artist, and one as a member of The Supremes.
