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Norway gas supply to Britain to ramp up on Friday, prices ease

Norway’s gas exports to Britain via the Langeled pipeline will gradually resume on June 7 following an outage that began on June 2, delivering just under half the normal capacity, Norwegian system operator Gassco said on Wednesday.

The ramp-up plan will see an available volume of 35 million cubic metres (mcm) of gas per day on Friday from Norway’s Nyhamna processing plant, some 44% of its overall 79.8 mcm capacity, according to a message on Gassco’s transparency page.

Gassco had said on Tuesday that gas would flow from Nyhamna via the Langeled pipeline to Britain’s Easington terminal but had not provided a volume estimate.

The Easington facility in northern England will ramp up on Friday from zero to 54 mcm/day, around 75% of its full capacity of 72.5 mcm/d, Gassco’s page showed.

Europe’s benchmark gas price, the Dutch front-month contract TRNLTTFMc1, eased to 33.45 euros/MWh from 33.75 euros/MWh seen before the Gassco update. It was down 2.2% by 1225 GMT versus Tuesday’s close.

Sunday’s outage drove European gas prices on Monday to a peak of 38.56 euros/MWh, their highest since December. Gassco attributed the incident to a crack in a two-inch pipeline onboard Equinor’s offshore Sleipner Riser platform.

Norway in 2022 overtook Russia as Europe’s biggest gas supplier after Moscow’s invasion of Ukraine, making any outages at Norwegian fields a possible trigger for higher prices.

The outage drove up prices in the United States and Asia as well on concerns it could tighten supply at a time of worries over remaining Russian volumes and an Asian heatwave increasing competition for liquefied natural gas (LNG).

The United States is a main exporter of LNG and supply outages elsewhere increase demand for U.S. exports and in turn lifts domestic gas prices.
Source: Reuters (Reporting by Nora Buli; editing by Terje Solsvik and Jason Neely)

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