Colder

March natural gas futures soared higher Thursday on a propellant derived from economic concerns mixed with colder-leaning forecasts. Not even a sub-200 Bcf natural gas storage withdrawal report could deter the prompt-month contract’s spike, which reached a high of $8.810 before settling the day at $8.772, up 38.4 cents from Wednesday’s close.

Transco said it will implement an Imbalance OFO effective Wednesday until further notice due to forecasts of much colder weather starting early this week in its entire market area. The pipeline reminded shippers of a notice two weeks ago advising of unplanned maintenance issues at Station 70 in Walthall County, MS, and at Station 100 in Chilton County, AL (see Daily GPI, Dec. 20) that continue to impact its ability to provide interruptible services, manage system imbalances and maintain intraday flexibility. In order to ensure system integrity, as of Tuesday (Jan. 1) Transco was not allowing excess storage withdrawals under WSS or GSS services, and it reduced pool imbalance tolerances to 1%. Wednesday’s OFO requires all customers to ensure that daily negative imbalances be no greater than 5%. Those with due-pipeline imbalances will not be subject to penalty, Transco said.

Two “bullish surprises” arrived this fall: a bit colder than expected temperatures and an “extremely” low level of liquefied natural gas (LNG) imports, which together suggests that Henry Hub prices in early 2008 may inch higher than a year ago.

Two “bullish surprises” arrived this fall: a bit colder than expected temperatures and an “extremely” low level of liquefied natural gas (LNG) imports, which together suggests that Henry Hub prices for the first quarter of 2008 may be higher than a year ago.

Most of the cash market saw higher prices Monday, including a lot of double-digit gains, driven by forecasts of colder weather later this week in much of the U.S. and Canada and Friday’s 30.1-cent advance by December futures. The return of industrial load from its typical weekend decline also provided some support for cash quotes.

A return of snow-bearing colder weather in the Rockies caused points there to spike by as much as $1.30 Monday and pushed some regional top-end prices above $6. Milder conditions elsewhere resulted in a mixed market that was mostly close to flat and in which losses moderately exceeded gains.

Natural gas snared a larger share of power generation in January due to lower prices and colder weather, the Energy Information Administration (EIA) reported last week. Net generation attributable to gas was up by 40.7% from January 2006.

Natural gas snared a larger share of power generation in January due to lower prices and colder weather, the Energy Information Administration (EIA) reported Tuesday. Net generation attributable to gas was up by 40.7% from January 2006.

Colder weather returning to northern market areas combined with rising power generation load for air conditioning needs along the entire southern rim of the U.S. to boost prices at most points. The cash market also had residual support from Friday’s 12.1-cent advance by May futures.