UK wholesale natural gas prices rise after system opens short

https://www.chemnet.com   May 18,2015

　　UK wholesale natural gas prices rose in early Friday trade, as the system opened undersupplied amid a sharp increase in exports to continental Europe.

　　Exports through the UK-Belgium Interconnector -- which fell sharply Thursday to 6 million cubic meters, the lowest daily figure for six weeks -- saw IUK 10 am UK time (0900 GMT) export nominations expected at 23 million cu m over the course of the day, after the ZEE day-ahead discount to the NBP equivalent narrowed to 0.75 pence/therm Thursday having been 1.50 p/th Wednesday.

　　As a result, National Grid 10 am demand forecasts were higher on the day at 202 million cu m, well up on the seasonal norm of 179 million cu m and with physical flows lagging at 199 million cu m/day.

　　National Grid forecasts for Monday were slightly lower than Friday's at 199 million cu m, still above norms given temperatures were forecast to remain below average into week 21.The NBP spot edged higher as a result of the short system as the within- day contract was dealt 0.15 pence/therm higher than Thursday's assessment at 44.60 p/th at 11 am, with the day-ahead changing hands at 44.90 p/th, up from 44.25 p/th.

　　Weekend also gained in value and was seen trading at 44.25 p/th, with front-month June climbing 0.20 p/th after having been dealt at 42.60 p/th Friday morning.

　　In terms of supply, UKCS production for Friday was nominated at 90 million cu m, slightly higher on the day, according to Eclipse Energy, an analytics unit of Platts.

　　Norwegian gas flows into the UK were running at 57 million cu m/day Friday morning, with the unplanned outage at Skarv continuing with a volume impact of 8.3 million cu m/day Friday and Saturday, according to Gassco.

　　Field maintenance was set to begin at Ormen Lange Monday as the field ramps down for yearly maintenance, before coming fully offline Tuesday until June 28, with a volume impact of 65 million cu m/day.

　　The Easington terminal will undergo a 24 hour shutdown Tuesday for a yearly emergency shutdown test, removing 71.2 million cu m/day of UK entry capacity.

　　LNG supply from South Hook was slightly lower on the day, but remained robust at 47 million cu m/day with several Qatari cargoes set to berth at the terminal before the end of the month.

　　Storage withdrawals from medium-range facilities were seen overnight, but ceased early Friday, with Eclipse reporting injection nominations of 16.5 million cu m from Rough for the day.

　　National Grid put UK gas stocks at 786 million cu m, 69 million cu m higher than at the beginning of the month but still well below levels from previous years.

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