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Enbridge launches Dawn storage hub open season in Canada

Increase font size  Decrease font size Date:2021-02-10   Views:36

  Houston—Enbridge has launched a binding open season for peak storage services at Canada's Dawn hub starting as early as April 1.

  Shippers can submit bids of up to 2 Bcf for a minimum of two years, the midstream operator said Feb. 8. Multiple bids will be considered. The open season runs until Feb. 11.Dawn is an Ontario storage and transportation hub operated by Enbridge.

  Besides being an important link in the movement of natural gas from key supply basins to markets in central Canada, it serves power generators, distribution and pipeline companies and energy marketers in the US Midwest and Northeast via interconnects with major pipelines including Vector, Great Lakes, Panhandle, Bluewater and MichCon. In the Northeast, it can tie in with natural gas supplies in the Appalachian Basin's Marcellus and Utica producing regions

  Among other things, the storage services at Dawn allow customers to balance demand and supply needs and hedge commodity purchases.

  Dawn, Ontario has consistently traded at a discount to US Northeast hubs Algonquin city-gate and Iroquois Zone 2 this winter. Dawn averaged a $8.16 discount to Algonquin city-gates so far in February and a $6.13/MMBtu discount to Iroquois Zone 2. Dawn's deep discount to the Northeast hubs is expected to narrow by March, with S&P Global Platts M2MS data showing an average discount of $1.83/MMBtu to Algonquin city-gates for Feb. 1-5.

  The deep discounts between Dawn and the Northeast hubs are exacerbated by winter demand in the Northeast; the most recent M2MS forward curve data for the 2021 summer strip (May - October) shows Dawn maintaining a slight premium of 15-20 cents to Algonquin city-gates.

  Enbridge is scheduled to release its latest financial results Feb. 12.

  Enbridge's goal in recent years has been to run a pure-play utility pipeline business that focuses on generating predictable long-term fixed fees. The company has sold billions of dollars in non-core assets to overhaul its portfolio around that mission, and it has retooled its corporate structure following the 2017 acquisition of US midstream operator Spectra Energy .

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