Natural gas prices in Western Canada continued their freefall as Enbridge Inc. targeted a mid-November restart for a ruptured pipe that cut off supplies to businesses, homes and oil refineries.
Gas at Alberta’s pricing hub dropped to a five-month low on Friday, according to data compiled by Bloomberg. Enbridge said in an update that it expects the 36-inch (91-centimeter) pipeline that burst two weeks ago to be operating at 80 percent of its capacity when it returns to service next month. In the meantime, Enbridge will continue pumping gas through a smaller line that’s in the same right of way as the pipe that burst.
The pipe outage is hitting one of the cheapest markets for natural gas in North America -- so cheap that sometimes the intraday fuel price falls below zero. Canadian gas has been pummeled by competition from U.S. shale supply and a dearth of pipelines and export terminals to carry the fuel to major markets.
With one less conduit to move Western Canadian gas to customers south of the border, AECO spot prices fell to 8 cents per million British thermal units on Friday, the lowest close since May 4. The record low in Bloomberg data stretching back to 1999 was 2.6 cents in September 2017.
Gas exports to the U.S. Northwest have risen after dropping to zero on Oct. 10 but remain near the lowest levels in at least four-and-a-half years. Once Enbridge restarts most of line, the system is expected to move between 900 million and 1.3 billion cubic feet of gas a day through the rest of the winter.
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