ch - ch - ch -changes
DESCRIPTION
2014 Natural Gas Outlook. Ch - ch - ch -Changes. Randy Friedman Director, Gas Supply July 8, 2014. Baby it’s c old o utside. Lower-48 10 Coldest Winters Since 1950. Bank of America, special report for NW Natural, April 1, 2014. Jan. 6, 2014 - Ice builds up along Lake Michigan. - PowerPoint PPT PresentationTRANSCRIPT
Ch-ch-ch-Changes
Randy FriedmanDirector, Gas
Supply
July 8, 2014
2014 Natural Gas Outlook
2
Baby it’s cold outside
Jan. 6, 2014 - Ice builds up along Lake Michigan
Lower-4810 Coldest Winters Since 1950
Bank of America, special report for NW Natural, April 1, 2014
2nd coldest in the last 35 years
3
Crazy after all these years
RBC Capital Markets, Weekly Underground Storage Report, April 27, 2013
Lowest spring inventory levels in a decade Pressure on summer refill prices Concern over storage inventory levels for the winter
4
We’ll meet again some sunny day
TD Securities, Commodities Market Comment, June 26, 2014
5
Everything old is new again
Active Gas Trading Hubs Storage Plants Owned or Contracted by NW NaturalPipeline Capacity Under Contract to NW NaturalNatural Gas Reserves Owned by NW Natural
6
Back in the saddle again We went from 100% reliance
on Sumas to zero after the Western Energy Crisis of 2000-2001 Added T-South to Station 2 Added SCP, Foothills, NGTL to
AECO
T-South contract is up for renewal and current Station 2 to Sumas price spreads do not justify retaining that capacity
About ½ of our Sumas receipts will still be gas purchased at AECO and delivered through SCP
As before with Station 2, we will hedge a high percentage of our winter purchases at Sumas due to its higher volatility
T-South
NGTLFo
othi
lls
SCP
Alberta(AECO)
Station 2
Sumas
7
It’s been such a long time…• NW Natural had relied on NWP’s
Plymouth LNG Plant for firm peak day service for over 30 years.
• Service was interrupted in Dec. 2013 due to pipeline constraints through the Columbia Gorge.
• We removed Plymouth for our firm resource stack and started evaluating replacement options through the IRP process.
• March 31, 2014: an incident at Plymouth probably means Plymouth will not even be an option for us this coming winter.
• We have some concerns if a design day hits, but the problem will ease the following year due to Mist recall.
8
Ease on down the road