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Canadian Export Supplies, Prices, Revenues Up

Canadian exporters dined out on a rich recipe of rising sales volumes and prices in the natural gas contract year that ended last Oct. 31.

Revenue jumped 44% to US$27.2 billion from US$18.9 billion the previous contract year, according to trade records kept by the National Energy Board. Canadian pipeline deliveries to the United States hit 3.7 Tcf in 2004-05, up 5% from 3.5 Tcf during the 12 months that ended Oct.31, 2004.

Annual average prices at the international border climbed by 36.7% to US$7.25/MMBtu in the 2004-05 contract year from US$5.30 for the previous 12 months. The combination of increased prices and sales more than made up for a negative exchange rate trend that raised the value of the Canadian dollar against its American counterpart, reducing the value of sales in exporters' home currency.

In Canadian funds, annual average export prices were up 25.7% to$8.19/gj for 2004-05 compared to $6.52 in 2003-04. Export revenues in Canadian dollars were $33 billion in 2004-05, up 32% from $24.9 billion for the previous contract year. The final weeks of the last contract year were a revenue gusher for Canadian gas exporters, as prices spiked on supply scares ignited by late summer hurricane damage to American production in the Gulf of Mexico.

Last October alone Canadian exports fetched US$3.56 billion, up 141.5% from US$1.47 billion in the same month of 2004. Average prices at the international border last October were US$11.70/MMBtu, up 126% from US$5.17 a year earlier.

Among regional destinations for Canadian gas exports, the northeastern U.S.was the growth star in the 2004-05 contract year, with pipeline deliveries rising 17.6% to 1.25 Tcf and prices climbing 36% to US$7.68/MMBtu. Export deliveries to the U.S. Middle West dropped by 3.4% to 1.56 Tcf for the 2004-05 contract year, but annual average prices rose 37.7% to US$7.28/MMBtu. Canadian pipeline shipments to California, once the top target of exporters, slipped 4.7% to 439 Bcf, but annual average prices rose 31.4% to US$6.64.

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