OREANDA-NEWS. Williams' inbound rail capacity to its Conway, Kansas, facilities are fully contracted for the upcoming summer months for the first time ever as NGL traders turn to the smaller hub to clear their liquids from production sites in the northeast.

NGL marketers see the Williams facilities as an attractive storage option in the face of market oversupply, Williams Partners' chief executive Alan Armstrong said during the company's first quarter earnings call.

Producers in the northeast are turning to rail to transport their excess NGL product out of the region. Estimated rail transportation costs from the Marcellus shale in Pennsylvania and West Virginia to Conway are 15-20?/USG, market sources told Argus. The costs to Mont Belvieu, Texas, are roughly 30?/USG and to Edmonton, Alberta, about 28-33?/USG.

Off-loading an NGL railcar costs the marketer roughly 4.5?/USG.

Conway is an advantageous storage location particularly for its unparalleled NGL rail capacity, close proximity to end-users and its pipeline connectivity to the Gulf coast hub in Mont Belvieu.

Spring and summer are the low seasons for NGL demand, and many participants expect storage to be an issue in the midcontinent and northeast before fall and winter seasonal demand picks up in October.

US propane inventories in PADD II stand at 18.331mn bl and keep growing steadily each week. On the east coast stocks are at 2.686mn bl, according to US Energy Information Administration data.

Conway propane traded at 46.25-47.5?/USG this morning. The product's value slid steadily over the last month as demand weakened.

Williams reported \$105mn less in commodity-related income year-on-year for the first quarter primarily because of lower NGL prices.