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MVP likely to bring strong flows, narrowing Appalachian basis
Rystad Energy is optimistic that these changes will significantly narrow Appalachian basis differentials. The complete article will help you anticipate flow changes based on detailed midstream analysis.
Read our special insight from Amber McCullagh, Senior Vice President at Rystad Energy.
Midstream analysis points to volumes being redirected from TETCO
Equitrans’s beleaguered Mountain Valley Pipeline (MVP) is in the final stages of development, set to commence operations about five and a half years after its initial fourth-quarter 2018 in-service date. On 22 April, Equitrans requested that the Federal Energy Regulatory Commission (FERC) authorize MVP’s in service by 23 May, so that the pipeline could be fully operational by 1 June. In a supplemental filing on 21 May, Equitrans adjusted its target in-service date to early June, due to weather delays, and on 10 June, the company submitted another filing indicating that the project was mechanically complete and hydrotested. In this most recent filing, Equitrans requested the FERC authorize the pipe be placed in service by 11 June.
Based on an in-depth analysis of both wellhead production data; connectivity between gathering systems, processing plants and transmission lines; and gas pipeline rates and contracts, Rystad Energy expects MVP to be heavily utilized within a couple months of entering service. Rystad Energy expects these MVP volumes to be mostly redirected, either directly or by displacement, from Enbridge’s Texas Eastern Transmission (TETCO). With Appalachian production not likely to ramp up significantly over the summer, Rystad Energy expects this reshuffling of flows to narrow Appalachian basis differentials.
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