The “unprecedented” high natural gas prices in the three-month period from November 2000 to January 2001 impacted not only natural gas liquids prices, but impacted how liquids were valued, according to a report by the Calgary-based National Energy Board. NEB said that as a result, NGL prices are “expected to continue to be influenced by both oil and gas prices.”

Because natural gas prices in the next few years are forecast to be “volatile,” NEB Chairman Ken Vollman said, “extraction economics become questionable. In other words, producers with discretionary volumes will make periodic decisions (based on oil and natural gas prices, as well as the price of NGLs in the marketplace, taking into account processing costs) on whether to extract liquids or leave them in the gas stream.”

The 10-page report, An Energy Market Assessment, was written as part of NEB’s mandate to monitor the Canadian supply of all energy commodities, including electricity, oil, natural gas and their byproducts, and to monitor the demand for Canadian commodities on both domestic and export markets.

To read the latest report, visit NEB’s web site at www.neb-one.gc.ca.

©Copyright 2001 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.