UK GAS-Prompt prices decline on strong wind, rise in LNG send-out
British prompt wholesale gas prices declined on Tuesday morning as high wind generation reduced demand from power plants and increased liquefied natural gas (LNG) send-out overcame less pipeline supply.
* British within-day contract was down 0.29 pence at 22.51 pence per therm by 0855 GMT.
* Gas for delivery the next day was down 0.20 pence at 22.25 p/therm.
* Low gas-for-power demand due to high wind output, coupled with and higher liquefied natural gas (LNG) send-out, has helped to mitigate a reduction in supply from the UK Continental Shelf (UKCS) production and Norway, analysts at Refinitiv said.
* Total LNG send-out is nominated at 43 million cubic metres (mcm), 15 mcm up from yesterday’s nominations due to higher-than-expected sendout from South Hook terminal.
* Peak wind generation is forecast at 14.1 gigawatts (GW) on Tuesday and 13.5 GW on Wednesday, out of a total metered capacity of 18 GW, Elexon data shows.
* High wind output generally lowers demand for gas from power plants.
* UKCS production has been impacted by a number of outages, while flows through the Langeled pipeline from Norway are down by 14 mcm from 23 mcm yesterday.
* The ramp-up of the Kollsnes gas processing plant will be slower than expected following an outage, the operator said.
* Several outages are coming up in Norway, which could limit flows through Langeled.
* The system was 5 mcm undersupplied, with demand forecast at around 134 mcm and flows at 129 mcm/day, National Grid data shows.
* In the Dutch gas market, the month-ahead price edged down by 0.05 euro to 8.31 euros per megawatt hour.
* The benchmark Dec-20 EU carbon contract was 0.12 euro higher at 27.40 euros a tonne.
Source: Reuters (Reporting by Nina Chestney)