- forecast: 229K
- actual: 230K
- increase of 7K from previous week; previous week revised to 223K
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Back to the Bakken
Active rigs:
$60.22↓ | 2/15/2018 | 02/15/2017 | 02/15/2016 | 02/15/2015 | 02/15/2014 |
---|---|---|---|---|---|
Active Rigs | 57 | 38 | 41 | 137 | 185 |
RBN Energy: capacity, demand constraints throttle Canadian gas imports to Chicago area.
Canada’s natural gas exports — which have been pushed out of the supply-rich U.S. Northeast in recent years — are also facing challenges in Western U.S. markets. Growing supply from North Dakota’s Bakken Shale is increasingly competing for capacity on the same transportation routes as imports and is targeting the same downstream markets.
Meanwhile, the rise of renewable energy in the West region from wind and solar farms is limiting gas demand in those target markets. What does that mean for imports from Canada?
There are three export pipes on the Canada side that move Albert supply to the western US border:
- Enbridge's Westcoast Energy Pipeline, 1.3-Bcf/d; British Columbia to Washington state;
- TransCanada Foothills which connects to Kingsgate (Idah) and into the Northern Border Pipeline (MT, ND), 2.4-Bcf/d;
- Veresen/Pembina's Alliance Pipeline, North Dakota; 2.0-Bcf/d pipeline
So both NBPL and Alliance are effectively flowing near capacity and, if anything, imports are gradually losing ground to Bakken supply on these two pipes.
Alliance last March floated the idea of expanding its throughput to Chicago by 500 MMcf/d, and the open season for that is expected sometime this quarter. But as we detailed earlier, Bakken production is expected to continue growing, which means competition for any incremental transportation capacity is likely to be stout, with the effect of intensifying price competition between the supply regions. And, finally, as we noted above, there is still the pushback that both Canadian and Bakken gas are likely to face on the delivery end of these pipes from Marcellus/Utica gas that’s pushing west.
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