A new natural gas pipeline stretching from Wyoming to the Oregon-California border will reshape the western U.S. gas market, further flattening prices and cutting reliance on Canadian supplies.
El Paso Corp's 680-mile Ruby interstate gas line began service in late July, and will eventually bring 1.5 billion cubic feet per day of Rockies supply to western consumer states.
"With Ruby, Rockies natural gas supplies will have direct access to the U.S. West's premium demand market area, PG&E city gate, which historically has been served primarily by Canadian gas supply," Bentek Energy said in a recent market alert.
Bentek data showed Ruby was already having an impact on the West Coast market, where Canadian producers historically held more than 95 percent market share of the total supply received
at the Malin, Oregon, hub.
At the same time, gas on Northwest Pipeline via Stanfield slid from about 170 mmcf per day to near zero, with a total of about 300 mmcf per day of Canadian gas displaced by gas from the Rockies flowing through Ruby, according to Bentek vice president Rusty Braziel.
"Whether it's maintenance on REX or less demand on REX, the result is the same, the need to move less gas east and more gas west. You've got to look at the winners and the losers and so far the winner is Ruby and the two losers are GTN and Northwest Pipeline," Bentek's Braziel said.
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