With bitter temperatures blanketing the US, the Everett LNG import terminal is helping New England residents stay warm and keep the lights on this week. It could be the last winter for the 52-year-old facility.
While LNG exports boom on the Gulf Coast, New England risks losing a key source of peaking supply if owner Constellation Energy (CEG) moves ahead with a plan to retire the terminal in mid-2024.
Operating since 1971, the Everett terminal is losing its primary customer, the nearby Mystic power plant in Boston, MA. The Mystic plant is set to retire in May 2024 as part of a Massachusetts state plan to transition off fossil fuels. Constellation is seeking new customers to take capacity at Everett, but the company could close the terminal later this year if those efforts don’t bear fruit.
East Daley Analytics covers LNG exports and imports in the US Macro Supply and Demand Forecast. We expect a shutdown at Everett to drive more volatility in regional natural gas prices, especially during periods of high demand like New England is experiencing this week. The terminal plays a critical role meeting regional spikes in heating load in frigid weather, as well as supplying power plants during critical weather events.
More recently, Everett has seen imports and utilization drop with the rise in global LNG prices. Lower LNG imports at Everett have translated to more volatility in citygate prices in Massachusetts (see figure). In 2022, peak monthly prices nearly doubled from peak levels prior to 2021, according to Energy Information Administration data (see figure). Spot gas prices topped $17/MMBtu this week at the Algonquin city gate.
Despite increased competition for LNG, Everett remains active and has received two LNG cargoes in recent weeks. Without the optionality for importing volumes, the region will need to rely more heavily on fuel oil for power and heating. – Alex Gafford Tickers: CEG.
Dirty Little Secrets is Now Available
Dirty Little Secrets is now available. East Daley held our Dirty Little Secrets annual webinar on Wednesday, December 13. In “Volatility Will Continue Until Morale Improves,” we reviewed the factors likely to drive volatility ahead in oil, natural gas and NGL markets. We review the outlook for these markets and the midstream sector. Review the Dirty Little Secrets webinar here.
East Daley, Hart Bring NEW Gas & Midstream Weekly
East Daley is teaming up with Hart Energy on the NEW Gas & Midstream Weekly newsletter. This new report combines the strengths of Hart Energy's journalistic reporting and analysis on natural gas, LNG, midstream energy and deal-making with EDA's deep research and intelligence of hydrocarbons, storage and transportation.
Published every Thursday morning, this new powerhouse newsletter is an interactive and enlightening read highlighting breaking news, exclusive interviews, videos, charts, maps and more. The newsletter utilizes East Daley's Energy Data Studio tools for natural gas predictive analytics with Hart Energy's Rextag mapping tools to present a holistic view of pricing triggers, infrastructure growth, pipeline and processing bottlenecks, regulatory and legal hurdles, and the inevitable solutions.
Energy Data Studio
East Daley Analytics has launched Energy Data Studio, a platform for our industry-leading midstream data and commodity production forecasts. All clients have access to the new client portal. If you have not yet logged in, please fill out the form to request a registration email be resent.
Energy Data Studio leverages our G&P data set for insights into midstream assets across every major oil and gas basin in North America. Users can navigate detailed visual dashboards by region, pipeline, or individual asset to understand crude oil, natural gas and NGL supply at the most granular level.
Energy Data Studio is available through data downloads from the visual interface, in Excel files, or as a direct feed delivered into subscribers’ workflow via secure file transfer. To learn more about Energy Data Studio, please contact email@example.com.
The Daley Note
Subscribe to The Daley Note (TDN) for midstream insights delivered daily to your inbox. The Daley Note covers news, commodity prices, security prices and EDA research likely to affect markets in the short term.