Canadian Natural Gas Rises as U.S. Heat Wave Spreads Eastward
Canadian natural gas rose on forecasts that a heat wave in the U.S. Midwest will spread eastward, increasing demand for the power-plant fuel.
Canadian gas prices, which usually follow their U.S. counterparts on the New York Mercantile Exchange, gained 1.2 percent as the U.S. National Weather Service said a “dangerous heat wave” now over the central U.S. would expand, bringing “excessive heat” to the mid-Atlantic region and South through the end of next week.
Alberta gas for August delivery gained 4.25 cents to C$3.645 per gigajoule ($3.60 per million British thermal units) as of noon New York time, according to NGX, a Canadian Internet market. September gas rose 3.75 cents to C$3.635. Gas traded on the exchange goes to users in Canada and the U.S. and is priced on TransCanada Corp. (TRP)’s Alberta system.
Natural gas in New York advanced 2.8 cents, or 0.6 percent, to $4.574 per million Btu as of 12:10 p.m.
Cooling demand in New York will be about 42 percent more than normal until at least July 25, said Weather Derivatives, based in Belton, Missouri. Power plants use 30 percent of U.S. gas supplies, according to the Energy Department.
The high in Indianapolis today may reach 90 degrees Fahrenheit, 4 degrees above normal, according to AccuWeather Inc. of State College, Pennsylvania.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 15.58 billion cubic feet as of 10:30 a.m. in New York.
Gas was flowing at a daily rate of 2.71 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 1.1 billion cubic feet.
Available capacity on TransCanada’s British Columbia system at Kingsgate was 1.04 billion cubic feet. The system was forecast to carry 1.72 billion cubic feet today, about 62 percent of its capacity of 2.76 billion.
Gas at the Alliance Pipeline delivery point near Chicago rose 9.6 cents to $4.5556 per million Btu on July 15 on the Intercontinental Exchange. Alliance is an express line that can carry 1.5 billion cubic feet a day to the Midwest from western Canada.
At the Kingsgate point on the border of Idaho and British Columbia, gas gained 4.42 cents to $4.1174.
To contact the reporter on this story: Colin McClelland in Toronto at email@example.com.
To contact the editor responsible for this story: Dan Stets at firstname.lastname@example.org.