EIA: Working storage gas to reach or exceed usual level by Oct. 1

The US Energy Information Administration projects that natural gas inventories will reach their usual level of 3,800 bcf by Oct. 31, the nominal end of the summer injection season.

Injections of natural gas into storage often continue into November, depending on weather and storage levels at the time, EIA said.

“Summer 2013 natural gas injections should outpace last year’s levels because aggregate storage at the Apr. 1 start of the injection season was 31% lower than in 2012, when storage was unusually high after an extremely mild winter,” EIA reported. “To meet their target storage inventory levels for the start of the 2013-14 winter, many local distribution companies will need to increase the amount of natural gas they have in underground storage fields this summer compared to last summer.”

Further, EIA reported that so far during this injection season, higher gas production and lower gas use for electric power generation have contributed to more injections compared with last year.

“Total injections this summer will be similar to those in 2008-11 but much higher than in 2012,” EIA said, citing that two key factors affecting injections during summer 2012 were starting inventories and gas use for power. “Injections were historically low last summer because the warmest winter in 60 years left end-of-season inventories at record highs. Moreover, the lowest spring natural gas prices in 10 years boosted natural gas use for electricity generation, as generators substituted natural gas for coal by changing the dispatch order of their generation plants,” the agency said.

“A colder-than-normal March this year contributed to a late winter drawdown of natural gas stocks in both the East and Producing regions, but Lower 48 inventories were still 10% above the 2007-11 average,” EIA reported.

Stocks at the end of March by storage region were: East, 661 bcf; West, 344 bcf; and Producing, 705 bcf.

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