(Source: Business Wire)
Growing natural gas production and new pipeline infrastructure in the Rocky Mountain area have sparked the development of a new NGI price index point, the White River Hub in Colorado, at the juncture of the Rockies Express Pipeline (REX) and lines from Questar, Northwest and TransColorado. The new hub became part of the Natural Gas Intelligence (NGI) daily and weekly price surveys in mid-August and its bidweek survey Sept. 1.
The White River Hub (WRH) started out near the top of the charts for Rockies pricing points, registering an initial daily average of $2.85, which compared to a range of $2.70-2.81 at the seven existing Rockies index points. This week WRH pricing has receded to approximate parity or slightly below neighboring locations.
In the September bidweek WRH was right on target with the largest volume Rockies pricing point, Opal, at $2.39.
Before WRH, the last Rockies index point to be added to the NGI survey was the Cheyenne Hub in 2000. The survey, published in NGI's daily and weekly publications, has grown from 48 price points in 1988 to 92 across the U.S. and Canada today.
Questar Pipeline, a subsidiary of Questar Corp., and a subsidiary of Enterprise Products Partners announced in mid-December that service had begun at WRH in northwestern Colorado's Rio Blanco County. It connected Enterprise's processing plant at the Meeker Hub with the major pipelines. Further volumes are expected to flow when Williams' 450 MMcf/d Willow Creek processing plant is completed, which is expected by the end of September.
Natural gas flows out of the Rockies area have been increasing with the completion of succeeding segments of Kinder Morgan's 1,300-mile, 42-inch REX line, first to Missouri in May of 2008, then into Ohio this past June.
WRH consists of four miles of 36-inch diameter pipe and about seven miles of 30-inch diameter pipe, plus tie-in and metering facilities. It has a design capacity of more than 2.5 Bcf/d of firm and interruptible transportation/wheeling service, allowing producers, marketers and shippers to access downstream markets for natural gas volumes produced in northwest Colorado's Piceance Basin.
A little less than 1 Bcf/d has been flowing through WRH recently, said Shelley Wright, director of business development for Questar Pipeline, the hub's operator. The current market weakness makes it difficult to say when full capacity will be reached, she said. About 2 Bcf/d of capacity has been contracted to flow through WRH.
WRH has been listed on the IntercontinentalExchange online trading platform since April. Wright said she was not aware of any other trade publication publishing a White River Hub index.
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