Canada Natural Gas Declines on Forecasts for Cooler Weather
Canadian natural gas dropped on forecasts for moderating weather that may limit demand for the fuel to generate electricity.
August gas in Alberta declined 4.3 percent as MDA EarthSat Weather in Gaithersburg, Maryland, predicted normal temperatures in the eastern U.S. and Canada from July 21 through July 30. Earlier forecasts were for hotter-than-normal weather in the U.S. Northeast and mid-Atlantic during that period.
“Milder weather is about the only thing that can take this market down a peg,” said Gordy Elliott, a risk-management specialist at INTL FC Stone LLC in St. Louis Park, Minnesota. “The heat looks like it’s finally going to break.”
Alberta gas for August delivery decreased 9.5 cents to C$2.125 per gigajoule ($1.98 per million British thermal units) as of 2:50 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.
Natural gas for August delivery on the New York Mercantile Exchange slid 7.3 cents to settle at $2.801 per million Btu.
The high in New York on July 29 may be 81 degrees Fahrenheit (27 Celsius), 3 below normal, according to AccuWeather Inc. in State College, Pennsylvania. The high in Atlanta may be 87 degrees, 1 lower than the norm.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.8 billion cubic feet at 2:30 p.m.
Gas was flowing at a daily rate of 2.05 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 1.9 billion cubic feet.
The available capacity on TransCanada’s British Columbia system at Kingsgate was 838 million cubic feet. The system was forecast to carry 1.78 billion cubic feet today, or 68 percent of normal capacity of 2.62 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 2.76 billion cubic feet at 1:50 p.m.
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