Canada Natural Gas Falls as Forecasters Moderate Outlook in U.S.
Canadian natural gas declined as forecasters moderated their outlook for temperatures in the U.S., which may lower demand for the power-plant fuel to help run air conditioners.
July gas in Alberta declined 4.2 percent after MDA EarthSat Weather of Gaithersburg, Maryland, adjusted forecasts to be cooler than previously predicted for the U.S. Midwest and Northeast near the end of the month.
“They seem to be moderating some of the forecasts and, given the thing has run 45 cents in two or three sessions, some profit-taking would make sense,” Martin King, an analyst with FirstEnergy Capital Corp., in Calgary, said in a telephone interview.
Alberta gas for July delivery dropped 8.5 cents to C$1.95 a gigajoule ($1.82 per million British thermal units) as of 5 p.m. New York time on NGX, a Canadian internet market. Gas traded on the exchange is shipped to users in Canada and the U.S. and priced on TransCanada Corp. (TRP)’s Alberta system. NGX gas is down 24 percent this year.
Natural gas for July delivery on the New York Mercantile Exchange fell 9 cents to settle at $2.545 per million Btu.
“Temps were cooled slightly late within the Northeast,” Eric Wertz, an MDA meteorologist, wrote in a six- to 10-day forecast today. He predicted “some slight cool changes in the Midwest and & East” in the 11- to 15-day outlook.
The high for New York on June 28 will be 72 degrees Fahrenheit, (22 Celsius) 11 below normal, said AccuWeather.com of State College, Pennsylvania.
Spot gas at the Alliance delivery point near Chicago rose 14.23 cents, or 5.6 percent, to $2.6761 per million Btu on the Intercontinental Exchange. Alliance is an express line that can carry 1.5 billion cubic feet a day from western Canada.
At the Kingsgate point on the border of Idaho and British Columbia, gas advanced 8.79 cents, or 4 percent, to $2.3027 per million Btu. At Malin, Oregon, where Canadian gas is traded for California markets, prices gained 11.02 cents, or 4.7 percent, to $2.4328.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.3 billion cubic feet at 5 p.m. New York time.
Gas was flowing at a daily rate of 1.98 billion cubic feet at Empress, Alberta, where the fuel is transferred to TransCanada’s main line.
At McNeil, Saskatchewan, where gas is transferred to the Northern Border Pipeline for shipment to the Chicago area, the daily flow rate was 1.99 billion cubic feet.
The available capacity on TransCanada’s British Columbia system at Kingsgate was 718 million cubic feet. The system was forecast to carry 1.83 billion cubic feet today, or 72 percent of normal capacity of 2.55 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 3.04 billion cubic feet at 3:50 p.m.
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