Canadian natural gas advanced on forecasts of above-normal temperatures that may increase power- plant use of the fuel.
August gas in Alberta climbed 2.2 percent as MDA EarthSat Weather in Gaithersburg, Maryland, predicted hotter-than-normal weather in the eastern and central U.S. from July 25 through Aug. 3. Cooling demand in the U.S. may be 8 percent above normal from July 26 through July 30, according to Weather Derivatives in Belton, Missouri.
“The near-term and long-term forecasts are pointing to high temperatures,” Carl Neill, a consultant with Risk Management Inc. in Atlanta, said in a telephone interview. “The heat is not abating, and traders are buying up gas as a result.”
Alberta gas for August delivery increased 5 cents to C$2.32 gigajoule ($2.17 per million British thermal units) as of 2:35 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 gained 8.2 cents, or 2.7 percent, to settle at $3.081 per million Btu, the first close above $3 since Jan. 9.
The high temperature in Chicago on July 23 will be 94 degrees Fahrenheit (34 Celsius), 10 above normal, and Atlanta will be 5 above 88 degrees, according AccuWeather Inc. in State College, Pennsylvania.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.5 billion cubic feet at 2:30 p.m. New York time.
Gas was flowing at a daily rate of 1.92 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 2.04 billion cubic feet.
The available capacity on TransCanada’s British Columbia system at Kingsgate was 825 million cubic feet. The system was forecast to carry 1.79 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 2.75 billion cubic feet at 1:35 p.m.
To contact the reporter on this story: Christine Buurma in New York at email@example.com
To contact the editor responsible for this story: Dan Stets at firstname.lastname@example.org