Both sides lost ground in the natural gas trade between Canada and the United States as emergency responses to the Covid-19 pandemic eroded economies during the first quarter of this year, according to the U.S. Department of Energy (DOE).

NOVA / AECO Natural Gas Prices

Canada fared worst, based on the latest trade scorecard compiled by the DOE’s Division of Natural Gas Regulation. Canadian exports to the Lower 48 dropped by 7% to 721.7 Bcf, or 7.9 Bcf/d in 1Q2020 from 776.2 Bcf or 8.6 Bcf/d in 1Q2019.

The average price fetched at the border by Canadian deliveries to the United States fell year/year by 32.7% to $2.37/MMBtu from $3.52/MMBtu.

The Canadian setbacks were nearly twice as severe as the contraction endured by U.S. exporters on their northbound cross-border gas flows.

U.S. exports to Canada dipped from a year earlier by 3.8% to 261.7 Bcf, or 2.9 Bcf/d, from 272 Bcf or 3 Bcf/d. The 1Q2020 average prices fetched by U.S. deliveries to Canada dropped by 20.3% to $2.80 from $3.51 in the same period of 2019.

Meanwhile, growth by U.S. exports to Mexico and overseas shipments of liquefied natural gas (LNG) before the pandemic more than made up for the contraction in the trade with Canada.

Total U.S. gas exports jumped by 36.7% to 1.46 Tcf, or 16 Bcf/d in 1Q2020 from 1.068 Tcf or 11.9 Bcf/d for the same period of 2019.

U.S. gas sales in Mexico grew by 9.8% to 478.6 Bcf, or 5.3 Bcf/d, from 435.6 Bcf or 4.8 Bcf/d in 1Q2019.

The average price for domestic gas at the Mexican border dropped by 14.6% to $2.63 in the first three months from the year-ago price of $3.08.

Overseas LNG exports to 32 countries continued to be the U.S. gas industry’s growth star, with South Korea the top customer followed by the UK and Japan in third place.

U.S. LNG tanker shipments jumped year/year by 99.5% to 720 Bcf, or 7.9 Bcf/d, from 360.9 Bcf or 4 Bcf/d.

The U.S. tanker exports fetched a wide range of 1Q2020 prices, from $3.47/MMBtu in Belgium to $7.36/MMBtu in Panama.

From the top three volume buyers, exports fetched average prices of $4.86 in South Korea, $4.94 in the UK and $6.52 in Japan.

The highest 1Q2020 price paid for U.S. LNG, $10.00, went to the smallest cargos, carried as container loads on freighters instead of via dedicated tankers to Haiti, Bahama Islands, Barbados and Jamaica.

LNG shipments in the first three months of 2020 nearly caught up to pipeline flows as the top method of U.S. gas exports by accounting for 49.3% of deliveries, the DOE said.