U.S. pipeline deliveries into Canada rose to 702.4 Bcf during the first nine months of 2011, up 38% from 509.9 Bcf in the same period of the previous year, according to trade records kept by the U.S. Department of Energy (DOE).

During the same nine-month period, volumes and prices of Canadian natural gas exports each suffered setbacks. Pipeline deliveries from Canada into the United States dropped by 4% to 2.4 Tcf during January-September from 2.5 Tcf in the same period of 2010, show records of the DOE’s Office of Fossil Energy.

Average prices fetched by Canadian gas at the international boundary fell by 7.4% to US$4.18/MMBtu in the first three quarters of 2011 from US$4.51/MMBtu during the same period of the previous year.

The performance was no surprise north of the border. The pattern followed a script in a 25-year market projection published late last year by the National Energy Board after a canvass of the industry and the gas supply outlook of Alberta’s Energy Resources Conservation Board. The Canadian projections anticipate deterioration of exports for about 10 years while domestic supply sources and demand go through a shuffle.

On the supply side, Alberta is expected to make a gradual exit from the international gas trade scene over the next 10 years. Conventional reserves are forecast to continue depleting while consumption goes up at the province’s northern thermal oilsands projects. British Columbia (BC) is expected to fill most of the export gap eventually, with new northern shale gas production tripling the province’s total output into the area of 10 Bcf/d after 2020.

But the Canadian projections make no attempt to guess where the majority of the exports will go when BC emerges as the prime international supplier. Lured by premium prices in Asia, an industry lineup is forming to build liquefied natural gas (LNG) export terminals on Canada’s Pacific Coast.

From the U.S. point of view, the gas trade with Canada is hovering on a plateau where it has been stuck since it peaked five years ago, then took a turn down for the first time since the mid-1980s. Annual Canadian pipeline deliveries into the United States topped out at 3.8 Tcf in 2007, then slipped during the 2008-09 economic contraction and have remained stuck ever since in the range of 3.3-3.4 Tcf. Total U.S. exports reached 1.135 Tcf during the first nine months of 2011, up 45% from 782.2 Bcf in the same period of 2010.

On top of the jump in shipments to Canada, U.S. pipeline deliveries into Mexico grew by 56% to 376.2 Bcf in the first nine months of 2011, compared with 240.2 Bcf in the same period of 2010. U.S. exports and re-exports of LNG were a lively minority of the international gas trade, growing by 77.4% to 56.9 Bcf in the first three quarters of 2011 from 32.1 Bcf during the same period of 2010.

Prices fetched by U.S. gas on the international market went in the same direction as the Canadian performance. U.S. pipeline exports went for an average US$4.49/MMBtu in the first nine months of 2011, down 8.4% from US$4.90/MMBtu during the same period of 2010. Prices remained much higher, in a range of US$8.50-12.15/MMBtu, on the small market for LNG exported and re-exported from U.S. terminals.

©Copyright 2012Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.