Did Storage Save Your Bacon?
Houston is home for me, our company and many of our employees. The recent bitter cold and the devasting impact it had hit home how vital a commodity natural gas is to our safety, our comfort and life itself. Like you probably, I have read the writings of many over the last two weeks, authoritatively casting blame for the root cause of our recent Power crisis, including arguments for and against fossil, nuclear and renewables. Of all my readings, a favorite was “Take a few moments to consider how much more truly devastating this would have been without natural gas as a clean and reliable energy source.” So, for those who have targeted natural gas to be expunged, if anything good came out of our recent darkness and frigid temperatures, let it be a new understanding of how vital natural gas is to our current infrastructure and how we live TODAY. Certainly, we must be planning for tomorrow, however to get there we must thrive today.
During the crisis, it was, in fact, natural gas that bore the brunt of our energy needs – not enough to carry the full load, but enough to be a stopgap that prevented greater devastation. With such supply issues, it’s not surprising we saw a spike in prices. “Natural Gas Prices Hit Historic $999/MMBtu High as Unrivaled Cold Strains Supply, Fuels Record Demand” is the title of one NGI article. When I saw this, I shivered, thinking about natural gas marketers across the US whose businesses could be shattered if: 1) they don’t have a Storage strategy and, as a result, 2) they are buying gas on the spot market.
Last Fall, I posted the blog, ‘Soaring Gas Price … Are You in It to Win It with Storage?’, covering the topic of storage in the context of the profit opportunity a natural gas storage strategy represents. While I highlighted “Sidestep financial loss” and “Avoid spot market highs”, I didn’t forewarn “once in a century” weather events like what we just experienced as a good reason for a storage strategy. Instead, I strived to make the case for every natural gas business to have a storage strategy touting the upside without sufficiently emphasizing the downside, which a great many natural gas marketers have now experienced. I did round out my message with, “Despite this, even a conservative storage strategy is better than no storage strategy.” So, the question is, did you take action after reading my blog and how glad are you that you did so? If you didn’t and you wish to, contact us today and we will help you with this and other areas that will enable you to achieve Natural Gas Operational Excellence.
Whether large or small, Marketers, Producers, LDCs, Utilities, and Pipelines face increasing competitive and compliance pressures, requiring increased operational efficiency, data integrity and process improvement. Their operational systems must support this, but most do not. Engage us and we’ll show you how to make an affordable breakthrough. It’s what we do for natural gas companies, and we are experts in our field. nGenue enables competitive advantage.
~Ken
