The US Energy Information Administration (EIA) reports that natural gas prices in the northwest US and western Canada have hit historic lows in 2024. Data from Natural Gas Intelligence shows that strong natural gas production in western Canada, combined with high regional inventories, has led to the significant price drop.
At the Westcoast Station 2 in western Canada, the daily spot price averaged US$1.04 per million British thermal units (MMBtu) through October, with September seeing the lowest monthly average of US$0.31/MMBtu. This pricing hub, located near Fort St. John in British Columbia, is a key indicator of natural gas production and supply in the region.
In the US Pacific Northwest, the Northwest Sumas pricing hub saw an average daily spot price of US$1.87/MMBtu through October, with the lowest monthly average of US$0.97/MMBtu recorded in May. These prices mark the lowest monthly average for the first ten months of any year since the EIA began collecting data in 1998.
Increased production in western Canada, averaging 18.2 billion cubic feet per day (Bcf/d) from January to October 2024, and higher natural gas exports to the western US have contributed to the low prices. Production has increased by 3% compared to the same period in 2023 and 11% above the five-year average, as producers prepare for future LNG exports from the LNG Canada terminal in Kitimat, British Columbia, expected to begin operations by mid-2025.
Meanwhile, natural gas exports to the US Pacific Northwest averaged 3.7 Bcf/d, 11% higher than the five-year average. As production increases, more natural gas has been stored, with Canadian inventories 37% above the five-year average as of August 31.
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