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Danger Ahead

As of mid December, the US was close to having used its mid-January stored gas draw. If January and February turn out to be abnormally cold in the east and midwest, there could be problems serving residential load.

On gas storage, EIA q.v. reports that as of Dec. 26: "For the second consecutive week, 158 Bcf of working gas was withdrawn from underground storage according to American Gas Association (AGA) estimates. A continuation of this rate through the end of the month will leave end-of-December inventories below 2 Tcf for the first time since 1976. Not until mid-January, when the rate of withdrawals dramatically increases, do stocks typically plunge through the 2 Tcf level. As a result of last week’s 158 Bcf draw, which was almost 50 percent more than EIA’s 5-year (1995- 1999) average December weekly rate, U.S. stocks were left at 2,098 Bcf on December 15, or 19.1 percent below the 5-year average as calculated by EIA. The East Region had a 100 Bcf withdrawal, the equivalent of almost 7 percent of its stocks in underground storage, which left stocks at 1,379 Bcf–12.9 percent below the 5-year average. The Producing Region had 484 Bcf in storage, 27.6 percent below the 5-year average, following a draw of 46 Bcf, which, like the East Region, was the second highest amount for the week since the inception of the AGA data 6 years ago. Continued high demand reported for electricity may have been a contributing factor to a 12 Bcf draw on stocks in the West Region. The West Region was 31.4 percent below the 5-year average at 235 Bcf."

Pete's no better at forecasting the weather than anyone else. Instead of being normal as NOAA forecast, December proved to be very cold. No one knows what lies ahead, but it's time for the political system to begin planning for, or at least considering, the unpleasant possibilities inherent in the situation. Certainly, one issue is whether the system can afford to keep all industrial gas demand satisfied without taking considerable risks (see Now is the Winter of Our Discontent -4 below). A second issue is whether the system can afford to let natural gas be burned to satisfy summer air-conditioning load again next summer in view of the likely impacts on next winter's gas storage deficiencies.

http://qv3.com/policypete/policypete.htm

-- Martin Thompson (mthom1927@aol.com), January 02, 2001