The Interstate Natural Gas Association of America reports marketers became more active in moving gas via firm transportation (FT) contracts and local distribution companies (LDCs) used more released capacity for receiving gas supplies in 1996.
It said gas deliveries increased 4% to 22.6 quadrillion BTU (quads) from the 1995 level of 21.8 quads.
Combined firm transportation services totaled 87% of deliveries to markets.
Interruptible transportation services continued to decline, down to 13% of deliveries in 1996 from 14% the previous year.
Ingaa's annual transportation report said that while LDCs continue to be the largest customers for FT service, accounting for 53% in 1996, the share of FT arranged by marketers rose from 29% in 1995 to 32% in 1996.
"End users arranged 15% of FT deliveries in 1996. For the third consecutive year, LDCs increased their utilization of released capacity and used less interruptible service.
"Volumes delivered via released capacity totaled 3.7 quads in 1996 and again surpassed the 2.9 quads delivered on an interruptible basis," the study said.
Ingaa Pres. Jerry Halvorsen said, "These trends in transportation services indicate short term services are comparable."
Shipper preferences
The Ingaa report also noted a growing shipper preference for prearranged capacity release deals over open-bid awards in terms of both total released capacity and the number of executed transactions.
"Open-bid awards declined from 23% to 10% of capacity awarded and from 27% to 14% of transactions from 1995 to 1996.
Additionally, more capacity and more transactions are being released for periods of time greater than 1 month."
The report said these trends could indicate that the market is settling down as shippers gain experience in capacity trading.
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