November 16, 2018 / 1:41 PM / a month ago

Natgas prices at Sumas Hub in Washington hit record high as weather cools

Nov 16 (Reuters) - Next-day natural gas prices for Friday at the Sumas hub on the border between Washington state and British Columbia quadrupled to a record high on forecasts for cooler, near-normal weather in the Pacific Northwest and declining pipeline flows from Canada.

That follows a week of mostly above-normal temperatures.

Prices in the region have been elevated since the amount of gas flowing from British Columbia to Washington was cut after one of Enbridge Inc’s Westcoast pipes in British Columbia was damaged in an explosion on Oct. 9.

The amount of gas flowing from British Columbia to Washington through the Sumas hub was expected to decline to around 0.3 billion cubic feet per day (bcfd) on Friday from an average of 0.5 bcfd since the pipe blast.

One billion cubic feet of gas is enough to fuel about 5 million U.S. homes for a day.

That compares with average flows of 1.1 bcfd during the 30 days prior to the blast.

Enbridge started to return the damaged 36-inch (91.4 centimeter) pipe to service on Oct. 31 and expects to increase flows to 80 percent of normal by mid November. The company said it would test the 36-inch pipe and an adjacent 30-inch pipe that is also operating at 80 percent of normal pressure to determine when it can restore both to full pressure.

At their reduced flows, Enbridge estimated the system can deliver up to 0.9 bcfd of gas to British Columbia and the U.S. Pacific Northwest.

Prices at the Sumas hub NG-PX-HUN-SNL jumped to a record high of $61.82 per million British thermal units (mmBtu) from $14.04 for Thursday, according to data going back to 2013.

Since the blast next-day prices have averaged $9.55/mmBtu. That compares with an average of $2.12/mmBtu since the start of the year before the blast, $2.60 in calendar 2017 and a five-year (2013-2017) average of $3.03.

High temperatures in Seattle, Washington’s biggest city, were only expected to reach the low 50s Fahrenheit (10-11 degrees Celsius) for most of the rest of November, after topping out in the upper 50s for much of this week, according to AccuWeather. The normal high in Seattle at this time of year is 50 degrees.

With the weather turning colder across the region, Fortis Inc’s British Columbia gas utility urged customers to conserve more energy because it was only receiving about 55 percent of the fuel it usually gets from the damaged Enbridge pipes in November.

Reporting by Scott DiSavino Editing by Susan Thomas

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