Feb. 3 (Bloomberg) -- Canadian natural gas rose after a report showed that the number of rigs drilling for the fuel in the U.S. slumped to a 26-month low.
Alberta gas gained 0.2 percent. Prices recovered from an earlier decline after Baker Hughes Inc. said the rig total fell 32 to 745, the lowest level since Nov. 20, 2009.
“U.S. gas rig counts are now falling sharply,” said Stephen Smith, an energy analyst and president of Stephen Smith Energy Associates in Natchez, Mississippi. “I doubt gas production growth will flatten to zero before late this year.”
Alberta gas for March delivery rose 0.5 cent to C$2.16 a gigajoule ($2.06 per million British thermal units) at 3:40 p.m. New York time on NGX, a Canadian Internet market. NGX gas has lost 0.8 percent this week.
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 5.5 cents, or 2.2 percent, to settle at $2.499 per million Btu. The futures have declined 6.7 percent this week.
Spot gas at the Alliance delivery point near Chicago rose 10.7 cents, or 4.3 percent, to $2.6042 per million Btu on the Intercontinental Exchange. Alliance, an express line, 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 9.97 cents, or 4.3 percent, to $2.4413, according to ICE. At Malin, Oregon, where Canadian gas is traded for California markets, gas was up 9 cents to $2.5584.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.4 billion cubic feet, 350 million below target.
Gas was flowing at a daily rate of 2.38 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 2.23 billion cubic feet.
Available capacity on TransCanada’s British Columbia system at Kingsgate was 504 million cubic feet. The system was forecast to carry 1.94 billion cubic feet today, or 79 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 3.02 billion cubic feet at 2:50 p.m.
--Editors: Bill Banker, David Marino
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