A fast ramp by Matterhorn Express Pipeline appears to backing out natural gas supply from several intrastate pipelines at the Katy hub, confirming a new rivalry between Texas basins for market.
East Daley Analytics monitors Matterhorn activity in the regional Permian Basin Supply & Demand and Houston Ship Channel Supply & Demand Report. Our review of flow data finds signs of displacement on the Trunkline and Tennessee Gas systems following the start of Matterhorn interconnects. In both cases, Permian gas would be backing out supply from other Texas intrastate systems.
Matterhorn started moving gas on October 1 from the Waha hub in West Texas, ramping to ~1.4 Bcf/d at the start of November. Built by WhiteWater Midstream, Matterhorn is delivering gas to six interstate pipelines near Katy, according to IIR Energy data.
Owned by Energy Transfer (ET), Trunkline Gas began receiving gas from Matterhorn on November 1 and has steadily moved ~150 MMcf/d since then. The start of Matterhorn deliveries coincides with an immediate decline in receipts from the Enterprise (EPD) and Midcoast systems of a similar magnitude (see figure). Flows from Enterprise and Midcoast haven’t stopped entirely, which means Trunkline is netting higher by ~10-20 MMcf/d.
Tennessee Gas Pipeline (TGP), the latest interconnect, began receiving Matterhorn gas on November 15 (see black in the top right of the second graph). A decrease can be seen at the TGP interconnect with the NET Mexico Pipeline (owned by NextEra) following the start of Matterhorn flows (see the pink shaded area in figure). The NMP interconnect is a bidirectional point and flows have been more irregular historically, so the relationship is less clear than the case of Trunkline.
In the Houston Ship Channel Supply & Demand Report, EDA has anticipated some flows backing up from other Texas basins as Matterhorn moves Permian gas to the Gulf Coast. Intrastate systems in Texas are difficult to track due to looser reporting requirements, but Matterhorn could be displacing supply from Carthage in East Texas or Eagle Ford production from South Texas. – Ian Heming Tickers: EPD, ET.
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