Natural gas prices in the Permian spent the first half of the year in the red. Between the beginning of the year and mid-June, cash prices in the basin were above zero only 11 days, most of them during an extreme cold snap in January that caused production freeze-offs. Then, in mid-June, someone — well, Kinder Morgan, to be specific — flipped a switch and now Waha prices are once again in positive territory. The “switch” was a compression expansion on Gulf Coast Express (GCX), which added a desperately needed 570 MMcf/d of takeaway capacity. As we discuss in today’s RBN blog, the pace of Permian production growth and the timing of two greenfield pipelines that will come online later this year will help determine where Waha prices go from here.
The NATGAS Appalachia weekly report provides the data and insights to monitor the northeast natural gas market’s twists and turns and identify the risks and opportunities along the way, including tracking supply-demand trends, outbound capacity and their impact on takeaway pipeline utilization, and regional prices.
When we wrote about the new infrastructure coming to the Permian in February (see Key to the Highway), we said this year would be “a tale of two halves.” The dashed oval to the left in Figure 1 below highlights the winter freeze‑off spike in Waha cash prices, which was followed by the subsequent slide into negative territory. To the right, the dashed vertical line marks the mid‑June startup of the GCX compression expansion, after which the cash price (yellow line) climbed back above zero and has, so far, mostly settled around $1.50/MMBtu. In other words, the dividing line between the two halves of the year isn’t magic, it’s new pipeline capacity opening up takeaway from the often-constrained Permian. (For more on the Permian Basin, see RBN’s monthly Arrow Model report, which tracks and forecasts shifting gas pipeline flows in Texas and Louisiana, and our weekly NATGAS Permian report, which focuses on key market drivers in the basin.)
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About the song
“Open the Door (To Your Heart)” was written by Van Morrison and appears as the first song on his 34th studio album, Born to Sing: No Plan B. The song is about emotional vulnerability and the realization that all the wealth in the world cannot replace love. The bridge in the song is very similar to Morrison’s pre-chorus in his 1971 song, “Wild Night.” Released as a single in September 2012, it failed to make the charts. Personnel on the record were: Van Morrison (vocals, alto sax, electric guitar, piano), Dave Keary (guitar, slide guitar), Paul Moore (bass), Paul Moran (keyboards, trumpet), Alistair White (trombone), Christopher White (tenor sax, clarinet) and Jeff Lardner (drums, percussion).
Born to Sing: No Plan B was recorded in 2012 at Morrison’s studio in East Belfast, with Morrison producing and Enda Walsh handling the engineering and mixing. The album was released in October 2012 and went to #10 on the Billboard 200 Albums chart. One single was released from the LP.
Van Morrison is an Irish singer, songwriter and musician. His professional career started in his teens when he joined The Monarchs in the early 1960s. He joined the Irish rock band Them in 1964 and penned the hit single “Gloria,” which went to #71 on the Billboard Hot 100 for Them and #10 for the Chicago-based band The Shadows of Knight. Morrison left Them, moved to the U.S., and went solo in 1967, releasing his debut album, Blowin' Your Mind, in September 1967. The single from that LP, “Brown Eyed Girl,” went to #10 on the Billboard Hot 100 Singles chart and was certified Gold by the Recording Industry Association of America. Morrison has released 45 studio albums, seven live albums, nine compilation albums and 82 singles. He has sold more than 40 million records worldwide. He has won a Brit Award, two Grammy Awards, an Ivor Novello Lifetime Achievement Award, and is a member of the Rock and Roll Hall of Fame, Songwriters Hall of Fame, and Irish Music Hall of Fame. He has an OBE, a French Officer of the Order of Arts and Letters, and a Freedom of Belfast Award. He still records and tours and will be playing select dates in Europe in July and September.
"About the Song" -- written by Mickey McMahan , RBN Director of Musicology
