Flows – Startup activities at the Plaquemines LNG project is lifting flows on Kinder Morgan (KMI) and Enbridge (ENB) gas pipelines, passing 1.3 Bcf/d combined.
Pipeline deliveries to Plaquemines LNG have been steadily climbing since early December ’24 as Venture Global moves the initial trains through the commissioning process. Venture Global reported that Plaquemines achieved first liquefaction mid-December, and that its first LNG cargo departed on December 26.
Satellite imagery monitored by East Daley Analytics shows construction at the Plaquemines site is moving along, with heat signatures visible at the facility. All nine blocks of the Phase 1 liquefaction trains are in place, while four of nine blocks for Phase 2 are in place (see image). Construction is likely still ongoing for the later blocks of Phase 1, as the earlier blocks have begun commissioning and liquefaction.
East Daley tracks Plaquemines LNG in the Southeast Gulf Supply & Demand Report. The project receives gas from KMI’s Tennessee Gas Pipeline (TGP) and the Texas Eastern Transmission (TETCO) system owned by ENB. Venture Global built the 42-inch Gator Express to connect to the pipelines 15 miles southwest of the Plaquemines project. As shown in the second figure, combined deliveries at the two Gator Express meters jumped to over 1.2 Bcf/d on Jan 15 and passed 1.3 Bcf/d last Wednesday (Jan 22), according to pipeline samples.
The ramp at Plaquemines LNG leans on recent expansions by TGP and TETCO to accommodate the new demand. KMI built the 1.1 Bcf/d Evangeline Pass project to move gas south on TGP and its Southern Natural (Sonat) system, while ENB constructed the 1.26 Bcf/d Venice Lateral Extension from the TETCO mainline in southeastern Louisiana.
Infrastructure – Kinder Morgan (KMI) is moving forward with the $1.7B Trident Intrastate Pipeline at a total capacity of 1.5 Bcf/d. The project will move Permian gas further east to serve growing LNG export demand and address a looming supply buildup in the Katy market.
KMI announced the Trident decision in the company’s 4Q24 earnings. The greenfield project is expected to begin service in 1Q27, pending regulatory approvals. Trident will run 216 miles northeast from the Katy hub to Port Arthur near the Louisiana border.
East Daley tracks the KMI project in the Houston Ship Channel Supply & Demand Report, where we have flagged an oversupply concern in the South Texas market. The Matterhorn pipeline began flowing gas to Katy in Oct ’24, and the Gulf Coast Express (GCX) expansion and Blackcomb Pipeline will bring in up to 3.0 Bcf/d of incremental Permian supply by 2027. Trident will help solve for this regional buildup.
In the initial open season, KMI said that Trident could deliver up to 2.8 Bcf/d, so future expansions are possible.
The Port Arthur/Gillis area currently hosts ~7.8 Bcf/d of average feedgas pipe capacity and can pull in as much as 8.8 Bcf/d during the winter months, when LNG production peaks. We forecast up to 4.7 Bcf/d of incremental LNG demand through YE27 from the Golden Pass LNG and Port Arthur LNG projects (see figure).
On October 15, Golden Pass LNG (2.7 Bcf/d) announced it had signed up for capacity on Trident. Golden Pass previously made commitments for 1.1 Bcf/d of firm transport out of the Haynesville on Energy Transfer’s (ET) Gulf Run Transmission. The joint Exxon (XOM) and QatarEnergy project also has a 340 MMcf/d commitment on KMI’s Natural Gas Pipeline (NGPL) system. East Daley estimates that Golden Pass needs ~1.16 Bcf/d of firm transport to fully supply the expanded facility, an unknown share of which will go to Trident.
Golden Pass has significant optionality in the Port Arthur area, with interconnects on the Golden Pass Pipeline to several major interstate and intrastate lines. Assuming that Trident doesn’t fully supply the remaining 1.16 Bcf/d, Golden Pass could underwrite an expansion on Gulf Run or pull in gas from Carthage on several intrastate systems (KMI Tejas, Texas, and HPL).
Flows –US flow samples declined to 66.8 Bcf/d for the January 26 week, down 1.8% W-o-W and well below production levels in December.
A polar vortex brought bone-chilling temperatures to most of the Lower 48 over the Jan. 26 week, reducing flows as wells froze over. Pipeline samples were lower W-o-W in the Bakken, Powder River, Appalachian, Permian and Eagle Ford.
The powerful front brought snowstorms as far south as Louisiana and the Florida panhandle. However, the Haynesville and Barnett recorded gains and were seemingly able to avoid freeze-offs, with the Barnett sample up 10% W-o-W.
With the worst of the weather behind us, samples were rebounding this week as temperatures warm and operations resume.
Storage – Traders and analysts expect the Energy Information Administration (EIA) to report a 313 Bcf storage withdrawal for the week ending January 24. The massive draw reflects bitterly cold weather over the survey week that caused demand to spike and curtailed some production. A survey by The Desk finds a wide range of expectations for the EIA survey, from -298 Bcf to a -340 Bcf withdrawal.
A withdrawal at the midpoint of estimates would exceed the 5-year average by 124 Bcf for the same week and flip the 5-year storage surplus to a deficit. EIA reported a 223 withdrawal last Thursday for the January 17 week, lighter than expectations for a 242 Bcf draw. The surplus to the 5-year average is currently just 21 Bcf, so the indicator could switch to an ~100 Bcf deficit after the next EIA report.
In the latest Macro Supply & Demand Report, EDA forecasts at total of 845 Bcf will be withdrawn from storage in January ’25, leaving inventories at 2,545 Bcf. Storage moves into a permanent deficit territory starting in February and could fall up to 200 Bcf behind the 5-year average by the end of March.
Rigs – The US rig count increased by 2 for the January 18 week, standing at 530 rigs. The Bakken (-3) and Barnett (-1) lost rigs while the ArkLaTex (+2), Permian (+2), Anadarko (+1), Eagle Ford (+1) and Marcellus + Utica (+1) added rigs on the week.
On the midstream side, Targa Resources (TRGP) is up 4 rigs net with additions on all its Permian systems. EnLink Midstream (ENLC) lost 3 rigs total on its Midland system.
East Daley’s weekly Midstream Activity Tracker monitors rig activity by basin and by gathering and processing (G&P) system to better understand midstream impacts. We allocate rigs and monitor flows through 150+ public and privately owned G&P systems in every North American basin. Reach out for more information on the Midstream Activity Tracker.
The Daley Note
Subscribe to East Daley’s 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.