Natural gas futures rallied over the first two days of the week but gave up that ground Wednesday as expectations for a stout storage build overlapped with the demand uncertainty inflicted by Hurricane Sally after it moved into the Gulf of Mexico (GOM) and made landfall.

The second phase of the reconfiguration of the Cempoala compressor station in Veracruz state will be complete in October, according to the general director of Mexico’s Centro Nacional de Control del Gas Natural (Cenagas), Elvira Daniel Kabbaz.

Speaking virtually last week at the Mexico Gas Summit hosted by Industry Exchange LLC, Daniel said that work at Cempoala was 97% complete and that the reconfiguration would allow 350 MMcf/d-1.4 Bcf/d of natural gas to be pumped, “not only to the south but also to the center of the country.”

Southeast Mexico, in particular the Yucatan Peninsula, suffers from recurring gas shortages and power outages, especially during peak summer months.

The Cempoala project would enable supply from the 2.6 Bcf/d Sur de Texas-Tuxpan marine pipeline to flow to the region.

As part of its five-year plan, Cenagas plans to expand the Montegrande injection point at Tuxpan by 400 MMcf/d to hit 900 MMcf/d, allowing for more U.S....

The October Nymex contract settled at $2.269/MMBtu, down 5.4 cents day/day. November fell 5.4 cents to $2.744.

The prompt month is down more than 40 cents from the high reached in late August amid a summer rally. Next day cash prices, meanwhile, remained under pressure, with NGI’s Spot Gas National Avg. down 17.5 cents to $1.685.

Forecast data Friday pointed to comfortable temperatures over most of the central United States and in the East for the second half of September, likely minimizing cooling demand.

“It is a low demand time of year, as we have a few more weeks yet until moving” into the heating degree day season, “so it is tougher for weather to move the demand needle much, barring stronger anomalies,” Bespoke Weather Services said. “This pattern would result in below-normal gas-weighted degree day totals for the nation…Storage, of course, remains at record levels in some regions, so we will need stronger burns and elevated” liquefied natural gas...

Natural gas futures dropped lower Thursday after the latest government report on gas stockpiles showed that storage is filling quickly as cooler fall temperatures sweep over swaths of the Lower 48.