Natural gas prices remain at near-record lows, but with so much production being driven by still-favorable crude oil economics there’s a distinct possibility — especially given the warm winter we’re in — that gas inventories may test storage capacity this year, perhaps as early as Labor Day. Of course, there are many market factors that might prevent this outcome, including lower production, a scorching-hot summer, and gas-to-coal fuel switching. But it could happen. And whenever we approach the limitations of natural gas infrastructure, we’ve seen time and again the disruptions and dislocations the market must deal with. The most obvious market signals are prices. But when it comes to gas flows another important barometer is the use of operational flow orders (OFOs). In today’s blog, we update one of RBN’s Greatest Hits and take a deep dive into the world of OFOs and what they can reveal about the state of the gas market.
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OFOs — notices issued by gas-storage operators, pipelines and local distribution companies (LDCs), key elements of the natural gas distribution network — have been around for decades, but really came into their own when natural gas transportation and sales were unbundled in the late 1980s and early 1990s (see Different Strokes for that history). Operational alerts and OFOs can be declared for all sorts of reasons: ruptures, pigging operations and other maintenance, compressor outages, freeze-offs, and other force majeure situations. They can also be issued if the pipeline does not have enough gas and pressures have dropped close to operational minimums, or the pipeline has too much gas and pressures are reaching operational maximums.
Natural Gas Infrastructure. Source: American Gas Association
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About the song
“Even Flow” was written by Stone Gossard and Eddie Vedder. It is the second song and second single from Pearl Jam’s debut album, Ten. Ironically, the band was never satisfied with the version that ended up on their debut album. Pearl Jam guitarist Mike McCready claims the band did more than 50 takes on the song, to the point that “we hated each other” after such a grind. Released in April 1992, the song went to #3 on the Billboard Mainstream Rock, #21 on the Modern Rock Tracks, and #62 on the Hot 100 charts. Personnel on the record were: Eddie Vedder (vocals), Stone Gossard (rhythm guitar), Mike McCready (lead guitar), Jeff Ament (bass), and Dave Krusen (drums).
Ten was recorded in March and April 1991 at London Bridge Studios in Seattle, with the band working with producer Rick Parashar. Released in August 1991, it went to #2 on the Billboard Top 200 Albums chart. Three singles from the LP made the charts. It has been certified 13x Platinum by the Recording Industry Association of America.
Pearl Jam is an American rock band formed in Seattle in 1990 by Stone Gossard and Jeff Ament. Their former band, Mother Love Bone, came to a quick demise after their lead singer Andrew Wood died of a heroin overdose on the day their album was released. Pearl Jam has had four drummers, up to the inclusion of former Soundgarden drummer Matt Cameron on the skins in 1991. Original members Vedder, Gossard, McCready and Ament have been in the band since its formation. They have released 11 studio albums, 23 live albums, three compilation albums, one EP, and 42 singles and have sold more than 85 million records worldwide. The band has won five American Music Awards, two Grammy Awards, and four MTV Video Music Awards. They were inducted into the Rock and Roll Hall of Fame in 2017. Pearl Jam still records and performs live. Their new album, Dark Matter, drops in April.
Comments
RBN - I remember many many years ago when watching the weekly storage changes was a big deal and trying to figure pipeline "parking" day-by-day...think about Enron and IPP traders, whoops, companies. Have you ever thought about just how much this "other" inventory is? Thanks