Insight
Northeast basis: Daily demand patterns point to sustained New England premiums over New York
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Report summary
Basis in almost all historically premium markets is falling, including Chicago, the West, and especially Pennsylvania points like Dominion. The exception is New England, with limited pipeline capacity and declining LNG imports. Last winter, New England pipelines were fully utilized on a 35-degree day, versus 20 degrees in previous years, sending basis to historic highs despite normal weather. And recently, the January Algonquin contract shot up from $8/mmbtu to more than $12/mmbtu. Last...
Table of contents
- Executive Summary
- Winter 2012-’13: A sign of things to come in the Northeast?
- This winter: Deep Panuke and Spectra pipeline loosen Northeast markets
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Medium term: Markets tighten, AIM project provides temporary relief
- Probable fundamental changes
- Possible pipeline capacity into New England
- Further upside risk: Brayton Point retirement
- Downside risk: Oil and LNG prices?
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Long term: Major pipeline capacity assumed
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Alternate paths: What if power markets don't support pipeline build?
- Power market resolution
- Small-scale LNG?
- Marcellus producer push?
- Eastern Canada shale?
- Key uncertainties and further analysis
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Alternate paths: What if power markets don't support pipeline build?
Tables and charts
This report includes 6 images and tables including:
- Chart 1. New England pipeline utilization and basis
- Chart 2. Recent winter weather distributions and constraint thresholds
- Chart 3. Basis outlook: Average day versus monthly average of daily basis
- Chart 6. New England and New York basis outlook
- Chart 4. New England fundamentals change vs winter 2012-‘13
- Chart 5. New York fundamentals change vs winter 2012-‘13
What's included
This report contains:
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