Canadian Gas Falls as Supplies May Be Adequate for Cold Weather

Canadian natural gas fell on speculation that colder weather in the U.S. won’t be enough to erode an abundance of the fuel in underground storage.

Alberta gas fell 2.6 percent. Demand for heat in the Northeast will average 4 percent above normal through Feb. 14, said Belton, Missouri-based forecaster Weather Derivatives. U.S. stockpiles stood at 2.966 billion cubic feet as of Jan. 27, 25 percent above the five-year average Energy Department data Show.

“The bump we’re seeing in U.S. temperatures has helped,” said Martin King, senior commodities analyst at FirstEnergy Capital Corp. in Calgary. “If it only lasts four or five days it’s too little, too late.”

Alberta gas for March delivery fell 5.5 cents to C$2.10 a gigajoule ($2 per million British thermal units) at 11:15 a.m. New York time on NGX, a Canadian Internet market. NGX gas has lost 27 percent this year.

Gas traded on the exchange is shipped to users in Canada and the U.S. and priced on TransCanada Corp.’s Alberta system.

Natural gas for March delivery on the New York Mercantile Exchange fell 8.4 cents, or 3.3 percent, to $2.466 per million Btu at 11:45 a.m.

Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.7 billion cubic feet, 98 million below target.

Gas was flowing at a daily rate of 2.45 billion cubic feet at Empress, Alberta. The fuel is transferred to TransCanada’s main line at Empress.

At McNeil, Saskatchewan, where gas is transferred to the Northern Border Pipeline for shipment to the Chicago area, the daily flow rate was 2.2 billion cubic feet.

Available capacity on TransCanada’s British Columbia system at Kingsgate was 552 million cubic feet. The system was forecast to carry 1.89 billion cubic feet today, or 77 percent of its capacity of 2.44 billion.

The volume on Spectra Energy’s British Columbia system, which gathers the fuel in northeastern British Columbia for delivery to Vancouver and the Pacific Northwest, totaled 2.98 billion cubic feet at 10:35 a.m.

To contact the reporter on this story: Gene Laverty in Calgary at glaverty@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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