The operational limits of some portions of the North American gas-storage system may be reached this fall. This creates the potential for an abrupt decrease in gas prices as some storage fields become unable to accommodate additional gas injections, Cambridge Energy Research Associates (CERA) reports. Absent a warmer-than-normal summer or significant gas-supply disruptions caused by hurricanes, the Massachusetts-based energy-research firm expects North American gas-storage inventories to reach 4.2 trillion cubic feet this October 31-a more than 95% fill of expected working-gas storage capacity. Given end-of-cycle physical limitations on injections, and expected average September and October storage injections-11 billion cubic feet (Bcf) and 10.2 Bcf per day, respectively-approximately equaling injection capacity, the firm believes that some gas-storage fields, especially in the eastern U.S., won't be able to accommodate additional injections. For more on this, see the July issue of Oil and Gas Investor. For a subscription, call 713-260-6441.
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