Canadian Natural Gas Falls as Stockpile Gain Exceeds Estimates

Canadian natural gas fell after a U.S. report showed that stockpiles of the fuel rose more than analysts estimated, cutting the need for imports.

Alberta gas declined 4.9 percent. U.S. stocks rose 57 billion cubic feet to 2.437 trillion last week, according to the Energy Department. Analysts expected a gain of 48 billion, the median of estimates compiled by Bloomberg.

“It was a pretty big number,” said Kyle Cooper, director of research at IAF Advisors in Houston. “There’s still plenty of supply.”

Alberta gas for April delivery fell 8.25 cents to C$1.595 a gigajoule ($1.52 per million British thermal units) as of 3:50 p.m. New York time on NGX, a Canadian Internet market. It was the lowest level for the April near-month contract since it started trading in 2000.

Gas traded on the exchange is shipped to users in Canada and the U.S. and priced on TransCanada Corp.’s Alberta system. NGX gas is down 44 percent this year. May gas fell 9.25 cents to C$1.645 a gigajoule.

Natural gas for May delivery on the New York Mercantile Exchange fell 13.3 cents, or 5.8 percent, to $2.149 per million Btu, the lowest settlement since Feb. 6, 2002.

Spot gas at the Alliance delivery point near Chicago declined 2.38 cents to $2.0338 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.

Spot Prices

At the Kingsgate point on the border of Idaho and British Columbia, gas rose 1 cent to $1.8576 per million Btu. At Malin, Oregon, where Canadian gas is traded for California markets, gas fell 1.68 cents to $1.9193.

Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.9 billion cubic feet, 78 million above target.

Gas was flowing at a daily rate of 1.95 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 2.25 billion cubic feet.

Available capacity on TransCanada’s British Columbia system at Kingsgate was 953 million cubic feet. The system was forecast to carry 1.7 billion cubic feet today, or 64 percent of its capacity of 2.65 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 2.99 billion cubic feet at 2:35 p.m.

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