Storage withdrawals in South Central US at a low

Natural gas storage helps balance supply and demand, particularly during the winter months when colder weather causes natural gas consumption to increase in response to increased demand for heating. As a result, withdrawals from and injections into storage are significantly influenced by temperatures and can vary regionally with weather patterns. Heating degree days (HDD) have been 13% below the 10-year (2013 – 2022) average in the South Central storage region this winter heating season, reducing the need to withdraw natural gas in response. As a result, natural gas consumption in the residential and commercial sectors in the South Central storage region was 13% below the five-year average this winter heating season, according to data from S&P Global Commodity Insights.

Increased production of natural gas has also contributed to below-average storage withdrawals in the South Central storage region this winter heating season. Several of the country’s major natural gas producing basins are centered there, including the Haynesville, Permian, Woodford, Eagle Ford, and Barnett. In addition, over 2 billion ft³/d of effective supply was available for US domestic consumption due to the shutdown of the Freeport LNG terminal in Texas last summer.

With just over 1550 billion ft³/d of underground storage design capacity, the South Central storage region is the largest region by design capacity. And because high deliverability salt cavern storage facilities make up nearly 30% of working storage capacity in the region, storage flows are more responsive to changes in temperature compared with other storage regions. In fact, the South Central storage region has the highest maximum deliverability of any storage region, at 51.8 billion ft³/d, compared with a range of 4.3 – 28.2 billion ft³/d in the other four storage regions, according to our estimates based on survey data. As a result, colder-than-normal winter temperatures in the South Central storage region typically result in large net withdrawals of natural gas from storage. However, due to above-normal temperatures in the region, large net withdrawals from storage in the South Central storage region have been uncommon this winter.

Read the article online at: https://www.hydrocarbonengineering.com/tanks-terminals/31032023/storage-withdrawals-in-south-central-us-at-a-low/