July 6, 2023

Malin Basis Differentials Relative to Henry Hub

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Malin Basis Drivers

Strong basis as California and the Pacific NW continues to struggle with security of supply in meeting winter peak-day requirements due to lack of storage and pipeline development.

West coast demand continues to decline throughout the forecast narrowing winter/summer spreads and average yearly basis.

Malin Price Forecast to 2035

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In general, all North American natural gas prices were impacted directionally the same over the past couple of years; downward due to the covid pandemic in 2020, increasing in 2021 as markets recovered and jumping considerably higher in 2022 following the Russian invasion of the Ukraine. However, not all price points were impacted to the same degree.

The 2020 Malin price of $2.10 USD/MMBtu is down almost 40% compared to $2.90 the previous year. Like all North American prices, Malin increased the 2 years following 2020; up 90% to $4.00 in 2021 and up a further 110% to $8.40 in 2022. Incorrys expects Malin prices to fall from $8.40 in 2022 to $3.30 in 2023 as increased supply balances the market. Prices generally continue to increase over the forecast period reaching $3.95 by 2035.

The Malin hub, located at the Oregon/California border, is the main hub serving California and other western markets.