Rita: US natgas prices rise 11.6 cents on slow recovery

26 September 2005 23:36  [Source: ICIS news]

HOUSTON (ICIS news)--US natural gas futures contract prices rose 11.6 cents (0.9%) on Monday, closing at $12.44 (Euro10.31)/m Btu as oil and natural gas facilities along the Texas Gulf coast slowly began the recovery process after Hurricane Rita.

 

New York Mercantile Exchange (Nymex) contract prices opened on Monday 54.4 cents lower at $11.78/m Btu as traders bid farewell to Hurricane Rita and anticipated a quick recovery by refineries and other oil and natural gas activities in the Gulf coast area. The decline continued until mid-morning when prices reached their lowest level of the day at $11.68/m Btu. The entire energy complex reversed direction after reports showed production was very slowly returning to normal and moved higher for the remainder of the session.

 

The Minerals Management Service (MMS) said on Monday that 204m cubic feet (mcf)/day of natural gas in the Gulf of Mexico was brought back into production, raising supplies to 2.157bn cubic feet (bcf)/day (21.576% of capacity) compared to 1.953 bcf/day for Sunday. The MMS also said 92.55% of the 819 manned platforms and 75.37% of the 134 rigs currently operating in the Gulf of Mexico were still evacuated. The agency calculated 163.869 BCF of natural gas production has been shut in during the 26 August-26 September period when hurricanes Katrina and Rita passed through the region.

 

Martin Edwards with the Interstate Natural Gas Association of America said he anticipates natural gas production in the Gulf of Mexico will be back up to at least 50% by the end of the week.

 

Some chemical operations along the Gulf Coast have said they have been forced to curtail or suspend operations because of a lack of natural gas.

 

Nymex said it would continue its force majeure for September natural gas deliveries at Henry Hub. Sabine Pipeline, the operator of the Hub, had announced on Friday it suspended operations due to low production from offshore fields.

 

(With additional reporting by Brian Ford)

By: Brian McIntyre
+1 713 525 2653

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