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RECORD HEAT CONTINUES THROUGH THE PLAINS STATES AND TEXAS

Even with 1/6th to 1/7th of exports off the board, record heat in the South and in the Plains states continues to drive pricing. Cooling demand is here and here to stay for the next few months.

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EXPLOSION AT FREEPORT LNG FACILITY SENDS MARKET TUMBLING

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FREEPORT COULD BE DOWN FOR 60-90 DAYS

  • An explosion at the Freeport LNG facility near Surfside, TX, caused the facility’s shutdown and sent July futures tumbling a whole dollar in three hours on Wednesday. However, the market had recovered about half of that by the week’s end.
  • Luckily, no injuries were reported, but the shutdown of that facility will take roughly 2 Bcf/d from exports. The facility is one of the three most extensive in the U.S., with a 2.6 Bcf/d maritime export capacity.
  • This has helped offset the record temperatures in the South and Southwest. AZ, TX, CA, and N.M. all saw 100-degree weather over the weekend.

 NATURAL GAS STORAGE REPORT

  • The explosion at the Freepoint LNG facility in Texas was the most significant market mover last week as the market dropped a whole dollar between 12 Noon and 3:00 PM on Wednesday. Originally expected to be shut down for three weeks, expectations now are closer to a minimum downtime of 60 to 90 days.
  • This explosion helps our Natural Gas pricing domestically as ~2.0 Bcf/d of Natural Gas will now stay domestic. That is 14 Bcf a week going back into storage.
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 PJM BGE FORWARD POWER PRICING

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PJM ADHUB FORWARD POWER PRICING

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Results of the June capacity auction for 2023-2024 that took place on June 8th should be released early this week. Unless the auction comes out like the last one at $50.00 per M.W., the new pricing will move the market.