NatGas Spikes As Major West Virginia Pipeline Declares Force Majeure

TC Energy’s Columbia Gas Transmission pipeline system issued a notice requiring an “immediate pressure reduction” on Mountaineer XPress Line 100 between the Mt. Olive Compressor Station in Jackson County and the Saunders Creek Regulator Station in Cabell County, West Virginia, warning that an “expected mechanical issue” would reduce scheduled volumes.

Columbia Gas Transmission moves Appalachian NatGas to markets across the Northeast, Mid-Atlantic, Midwest and Southeast, with connections carrying supplies deep south to export terminals on the Gulf of America.

The affected Mountaineer XPress (MXP) pipeline in West Virginia feeds two main outlets:

• Regional markets: Columbia’s TCO trading pool, serving Midwest, Northeast and Mid-Atlantic customers.
• Southern markets: The Leach interconnection in Kentucky, where gas enters Columbia Gulf Transmission for transportation toward the Southeast and Louisiana’s Gulf Coast.

NatGas research firm Criterion Research provided clients earlier today with an update on the outage:

TCO declared force majeure this morning following an unexpected mechanical issue on its Mountaineer XPress (MXP) system between the Mt. Olive Compressor Station and Saunders Creek Regulator Station in West Virginia, with the pipeline set to cut the MXPSEG MA42 constraint to zero beginning with the Sept. 25 Timely Cycle.

TCO estimates 1.8 MMDth/d of firm service will be affected, roughly matching the 1.88 MMDth/d currently scheduled through MXPSEG.

MXP is a 2.7 Bcf/d Appalachian takeaway system moving Marcellus/Utica supply south through West Virginia into TCO’s broader system. Upstream MXP receipts have not yet materially responded, with Sherwood flowing ~714 MDth/d, Corral ~267 MDth/d and Viking ~5 MDth/d today, but the full restriction should begin showing up in tomorrow’s nominations and could force significant rerouting or production cuts if the roughly 1.8 Bcf/d cannot find alternate paths. TCO has not provided a restoration timeline and expects to issue another update Friday morning.

October gas futures climbed 4.5%, or 13.6 cents, to $3.159 per million British thermal units on Nymex as of 11:00 a.m. ET. Prices have jumped more than 12% since early Wednesday. 

Flow restrictions can tighten downstream supplies even when natural gas remains abundant at producing wells across Appalachia.