Rising U.S. production of NGLs and so-called “purity products” like ethane and propane, as well as growth in steam cracker capacity and NGL and ethylene exports, are giving added importance to NGL and ethylene storage capacity in underground salt caverns along the Gulf Coast. Mont Belvieu, TX, has long been the epicenter of both fractionation and salt-cavern NGL storage — and it will remain so — but there are other areas along the Texas coast with frac capacity and NGL storage, as well as steam crackers and export docks. The questions now are, is there enough in the right locations, and can what’s stored there be received and quickly sent out? Today, we begin a look at existing and planned NGL storage facilities along the Texas coast that are not in Mont Belvieu.

Growing natural gas supplies in Western Canada have been pressuring gas prices and export pipelines in the region, but there are signs that at least some of that supply-growth pressure is being offset by rising gas demand. Though the region is pegged as primarily a winter gas market — where local demand only rises when the temperature falls into the winter extremes — non-weather-related demand for natural gas has been growing in Western Canada and looks to have further upside in the years ahead. Today, we delve into Alberta and British Columbia’s gas demand trends and their potential to help balance the region’s oversupply conditions.

It’s been an exciting and productive few years for Permian producers, but it’s also been a period fraught with challenges. Dealing with a mid-decade crash in crude oil prices. Struggling to improve yields from the Wolfcamp, Bone Spring and other hydrocarbon-rich formations to lower breakeven costs. Coping with major pipeline takeaway constraints — for crude and natural gas — and the resulting price discounts. Now, the challenge of produced water has come to the fore. Horizontal wells in some parts of the Permian generate six, eight, even 10 barrels of produced water per barrel of crude, and all of it needs to be either disposed of or treated. The volumes are enormous, the permitting and logistics mind-boggling, and the costs — well, you can imagine. Today, we consider the Permian’s produced-water conundrum as crude and gas production volumes ramp up. Warning!: Today’s blog is a blatant advertorial for new reports by B3 Insight on Permian produced water.

Bakken crude oil production surpassed 1.4 MMb/d this spring and has maintained a level near that since, even posting a new high just shy of 1.5 MMb/d in April 2019. The rising production volumes have filled any remaining space on the Dakota Access Pipeline (DAPL) and prompted midstream companies to step up expansion efforts to alleviate the pressure, even as questions linger about the possibility of a pipeline overbuild if all of the announced capacity gets built. Specifically, the market is weighing the need for the recently announced Liberty Pipeline and a DAPL expansion. Today, we look at these two new projects and what their development means for the supply/demand balance in one of the U.S.’s biggest shale basins.

After sustaining a record pace since March, natural gas storage injections have been slowing dramatically and are projected to fall below the 5-year-average rate over the next few weeks. While weather has factored heavily into the swing in storage activity, increased baseload demand for gas in the power sector has amplified the effects of weather anomalies and electricity demand seasonality on overall gas demand. As a result, gas demand volumes have diverged from historical levels on a temperature-adjusted basis. Today, we examine the changing historical relationships of power burn and storage injections to weather and electricity demand.

Once consigned to a flat or declining profile, natural gas production in Western Canada has been increasing steadily since 2012, to the extent that it has now begun to stretch the ability of the existing pipeline network to the breaking point. Most striking is that this expansion in production has been taking place in an era of declining natural gas prices and weakening basis for Western Canada’s primary natural price marker, AECO, and rising and relentless competition from U.S. gas supplies in several of Canada’s key domestic and export markets. If the pricing, pipe egress and export situation has become so dire, why are producers still drilling for and pumping out even more natural gas? Today, we address this question in the second part of our series investigating Western Canada’s natural gas supply and demand balance.

The battle over the future of Enbridge’s Line 5 light crude oil pipeline through Michigan is heating up. In recent weeks, Michigan’s new attorney general filed suit to throw out the 1953 easement the state granted to allow the pipeline to be laid under the Straits of Mackinac — the narrow waterway between Michigan’s upper and lower peninsulas — and to block implementation of an agreement Enbridge and the state’s then-governor reached last fall to replace the section of Line 5 under the straits by the mid-2020s. Enbridge is pressing ahead, maintaining that the existing pipeline is safe and the 2018 agreement is legal and fully enforceable. All that raises two questions: just how important is Line 5 to the Michigan and Eastern Canadian refineries, and what would those refineries do if the pipeline were to cease operations? Today, we discuss recent developments and examine the issues at hand.