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UK GAS-Prices fall on domestic production surge, higher Norway imports
July 29, 2016 / 8:36 AM / a year ago

UK GAS-Prices fall on domestic production surge, higher Norway imports

* Gas system nearly 19 mcm oversupplied

* UKCS flows reach highest level since April

July 29 (Reuters) - British wholesale gas prices fell on Friday morning as UK domestic production flows reached their highest level since April and Norwegian imports through the Langeled pipeline increased.

Gas for weekend delivery was down 0.80 pence at 34.60 pence per therm at 0821 GMT from the previous settlement, while gas for August delivery was 0.38 pence lower at 35.75 pence per therm.

The UK gas system is 18.7 million cubic metres (mcm) oversupplied, with flows at 196.6 mcm/day and demand forecast to be 177.9 mcm.

Flows through the Langeled pipeline from Norway rose and UK Continental Shelf flows are at 148 mcm/d, their highest level since the end of April, Thomson Reuters data shows.

This is mostly due to an increase at St Fergus Mobil terminal deliveries over the past two days, Thomson Reuters analysts said.

Britain’s biggest gas storage site is unavailable for gas injections until March or April next year. This has curbed UK injection demand by around 24 mcm/d, said UK-based consultancy Energy Aspects.

“While mid-range sites may be able to soak up some of the gas previously intended for Rough, UK mid-range sites are already fuller than at the same point last year,” they said in a note.

In the Dutch gas market, weekend prices at the TTF hub were down 0.20 euro at 13.75 euros per megawatt hour.

In Europe’s carbon market, benchmark EU allowances were 0.09 euro lower at 4.40 euros a tonne. (Reporting by Nina Chestney)

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