Waha Price Collapse Signals Worsening Gas Supply Glut In The Permian -- RBN Energy -- February 15 2019

Waha later, whoo-hoo now: WTI up 2%, up over $1.00/bbl; now trading above $55. Whoo-hoo.

Busy, busy day. Later:

• Victor Hanson: Progressives bearing gifts
• Powerline
• how the US Senate voted on the funding bill: Bernie Sanders and Amy Klobuchar voted for the bill
• the man who killed the NYC-Amazon deal
• the Verge, November 14, 2018
• The NYT, February 4, 2019 
• more on that North Dakota bull story -- over at Schwa Nation
•  Rigzone news
• https://t.co/nnJ6yljeHC -- a PDF will likely load on your desktop 

***********************************

Back to the Bakken

Wells coming off confidential list today -- Friday, February 15, 2019: 56 wells for the month; 159 wells for the quarter

• 33922, 938, Oasis, Dawson 5494 42-12 3B, Alkali Creek, t9/18; cum 132K 12/18;
• 33918, 940, Oasis, Dawson 5494 42-12 4T, Alkali Creek, t9/18; cum 120K 12/18;
• 33916, 901, Oasis, Dawson 5494 41-12 2T, Alkali Creek, t9/18; cum 114K 12/18;
• 30136, 1,008, CLR, Pletan 5-18H2, Jim Creek, t11/18; cum 48K 12/18;

Active rigs:

$55.49	2/15/2019	02/15/2018	02/15/2017	02/15/2016	02/15/2015
Active Rigs	65	57	38	41	137

RBN Energy: Waha price collapse signals worsening gas supply glut in the Permian.

The U.S. natural gas market last week was again reminded of the hair-trigger conditions that Permian producers and marketers are operating under — with gas production pushing against available takeaway capacity, all it takes is an otherwise minor/routine maintenance event on even one West Texas takeaway pipeline to send regional gas prices spiraling into negative territory. Waha Hub gas prices last week collapsed to their lowest level ever, with intraday trades even going negative — meaning some had to pay the market to take their gas. This wasn’t the first time that’s happened in the Permian — a similar event occurred in late November 2018 — but it was the worst to date and signals a heightened supply glut in the region, at least until the first new takeaway pipeline comes online in the fourth quarter of this year. Today, we explain the recent price weakness in West Texas and implications for Permian basis in 2019.

A reminder, the Waha hub, from an earlier RBN Energy post:

The Waha Hub is situated in northern Pecos County in West Texas near Fort Stockton — about 260 miles east of El Paso. Geologically speaking, the hub sits atop the Permian’s Southern Delaware Basin, an oil-rich part of the larger play. Like any good, liquid trading hub worth its salt, Waha is well connected, with ample receipt, delivery and takeaway capacities. The Waha Hub comprises interconnects with more than a dozen takeaway pipelines, including four major interstate pipelines and nine Texas intrastate pipelines, together totaling more than 10 Bcf/d of takeaway capacity. This capacity is all the more important given that there is little demand near the hub itself — less than 250 MMcf/d, on average — which makes Waha primarily a transit hub.