Bloomberg News

Canadian Natural Gas Falls as Stockpile Gain Exceeds Estimates

March 29, 2012

Canadian natural gas fell after a U.S. report that stockpiles of the fuel rose more than analysts estimated.

Alberta gas declined 3.9 percent. U.S. stocks of the fuel rose 57 billion cubic feet to 2.437 trillion last week, according to the Energy Department (DOENUSCH). Analysts expected a gain of 48 billion, the median of estimates compiled by Bloomberg (DOENUSCH).

“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 6.5 cents to $1.6125 a gigajoule ($1.54 per million British thermal units) as of 12:20 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. (TRP)’s Alberta system. NGX gas is down 44 percent this year.

Natural gas for May delivery on the New York Mercantile Exchange fell 11.1 cents, or 4.9 percent, to $2.171 per million Btu as of 11:56 a.m.

Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 17 billion cubic feet, 185 million above target.

Pipeline Flows

Gas was flowing at a daily rate of 1.97 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 2.3 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 3.01 billion cubic feet at 10:35 a.m.

To contact the reporter on this story: Gene Laverty in Calgary at glaverty@bloomberg.net

To contact the editor responsible for this story: Bill Banker at bbanker@bloomberg.net


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