Majeure Forces Alliance to Cut Natural Gas Flows to Zero for Now
![](http://pgjonline.com/old_assets/wp-content/uploads/sites/2/2015/08/alliance-pipeline.jpg)
The Alliance pipeline will be shut down for an unspecified period of time due to the presence of excess hydrogen sulfide on the mainline, according to Alliance Canada. The event constitutes a force majeure.
During the past 30-days, Alliance Canada has been flowing an average 1,792 MMcf/d across the border to Alliance U.S., with single-day flows reaching as high as 1,977 MMcf/d on the roughly 2,000 MMcf/d capacity system.
Alliance flows “wet” gas out of British Columbia, Alberta and Saskatchewan, primarily for delivery to the Aux Sable processing plant in Illinois. At the outlet of the Aux Sable processing plant, dry gas gets delivered to a variety of inter- and intrastate pipelines and industrial consumers.
Historically, and during the past 30-days, the bulk of those deliveries go to Vector (50% during the past 30-days, or 904 MMcf/d), followed by ANR (30%, or 504 MMcf/d), and the Aux Sable plant itself (12%, 212 MMcf/d).
Alliance was shut down completely in early October 2012 for pipe relocation activities. During that period, trading activity on Alliance Interstates was suspended and downstream deliveries from the Aux Sable tailgate fell to zero (with the exception of small volumes to a few pipes). The current shut-down will likely cause many upstream producers to shut-in or direct displaced gas to the TransCanada NOVA or Westcoast systems where that is an option.
One producer – Seven Generations – issued a statement today, confirming they will halt production during the shut-down. If producers instead place gas onto NOVA or Westcoast, it will likely place downward pressure on AECO and Westcoast Station 2 prices. In addition, Station 2 will be further pressured by the loss of Westcoast’s ability to deliver gas to Alliance, forcing the gas to instead flow southward on Westcoast. Downstream prices around the Chicago market may increase as alternative sources of supply are sought, though, milder weather and the coming weekend may limit a rally.
During the past 30-days Alliance Canada has been flowing an average 1,792 MMcf/d across the border to Alliance U.S.
At the outlet of the Aux Sable processing plant, dry gas gets delivered to a variety of inter- and intrastate pipelines and industrial consumers.
Related News
Related News
![](/media/2035/pgj-enews-graphic-300x1404.jpg)
- Williams' $1 Billion Gas Pipeline Blocked by U.S. Appeals Court, Derailing Five-State Project
- Texas Waha Hub Gas Prices Plunge to Record Lows, Hit Negative Territory
- U.S. Buys Nearly 5 Million Barrels of Oil for Emergency Stockpile
- Williams Begins Louisiana Pipeline Construction Despite Ongoing Legal Dispute with Energy Transfer
- U.S. Appeals Court Strikes Down Controversial Biden Pipeline Safety Rules
- U.S. to Buy 4.5 Million Barrels of Oil to Replenish Strategic Petroleum Reserve
- Kurdish Oil Smuggling to Iran Flourishes
- U.S. Court Overturns Alaska Oil Lease Sale, Halting Energy Development
- Second Gas Pipeline Rupture in Texas’ Reeves County Raises Environmental Concerns
- Mid-Year Global Forecast: Midstream Responding to Demand from LNG Projects
Comments