Western Price Survey
May 13, 2016
Wildfires across Alberta, Canada, halted oil-sands operations, triggering a drop in natural gas consumption used for exploration and production, which helped push prices to record low levels.
The fires started May 1 near Fort McMurray, a major oil-sands production area. Production fell roughly 1 million barrels per day, according to the U.S. Energy Information Administration. Natural gas consumption in the province correspondingly dropped roughly 25 percent.
Natural gas prices at the AECO trading point reached 55 cents/MMBtu May 9, "their lowest price in the 14-year available history," according to EIA, although prices were already low based on high natural gas storage levels in the United States and Canada. Alberta storage is reportedly nearing capacity and could be full within months.
Working natural gas in storage was 2,681 Bcf as of May 6, according to EIA estimates. This is a net increase of 56 Bcf compared to the previous week. Storage levels are now 43.8 percent greater than a year ago and 43.5 percent greater than the five-year average.
Henry Hub gas spot values lost 4 cents in Thursday-to-Thursday trading, ending at $2/MMBtu May 12.
Western natural gas average values varied. Stanfield gained 8 cents to end at $1.82/MMBtu on May 12, while Sumas values dropped 35 cents to $1.06. PG&E CityGate remained above the $2 mark at $2.13/MMBtu by the end of trading.
Meanwhile, daytime power prices were relatively flat in May 6 to May 13 trading. California-Oregon Border was the exception, adding $5 to an average of $18.90/MWh.
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Average nighttime power prices varied, with Northwest values adding as much as $4.60 in Friday-to-Friday trading. South of Path 15, in contrast, lost $2.95 to reach $17.35/MMBtu.
Demand peaked on the CAISO grid at 31,354 MW May 12, which should be the week's high. Total renewables production on the CAISO grid reached 11,231 MW May 9. Total solar production reached 7,741 MW May 11, while thermal generation peaked at 12,723 MW May 12.
The statewide snow-water equivalent was 8.2 inches, or 47 percent of the historical average, as of May 12, according to the California Department of Water Resources.
Northwest Power Pool demand reached 48,514 MW May 12, but the week's high was expected to occur May 13, when demand was projected to reach 51,251 MW [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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