LNG Boosts UK Gas Supply

The northwest European cold spell has driven prices up at the Dutch and UK hubs, and more LNG is flowing into the UK grid and less pipeline gas from the continent, according to instantaneous flow data published by UK National Grid February 8 and 9. There were three LNG import terminals flowing at time of press: two at Milford Haven and one at the Isle of Grain. Collectively they were delivering 100mn m³/d, based on current data, which is subject to change over the gas day which ends at 05.59.

There was a similar cold spell in January but then there was sufficient gas on the continent for there to be some pipeline exports to the UK. The past few days however have seen gas flow out of the UK through Interconnector UK, in response to higher prices in mainland Europe.

National Grid told NGW late February 8: "The interesting feature of supply today is that we are not receiving any gas through IUK which is quite different to January when they were flowing quite hard. This is probably linked to the very cold temperatures in Europe. Isle of Grain supplies have increased to compensate so actually the pattern of supply is not that different."

National Grid told NGW that daily flows exceeded 400mn m³ also in January and those might have been the highest for a decade. Most of the demand has been for local distribution zones, although gas was flowing at a rate of 80mn m³/d to power stations February 8-9.

However, that is the instantaneous rate, which falls at night-time. This was lower than in January, when lower renewable energy was generated owing to less wind. Total demand was 450mn m³, of which: local distribution zones, 330 mn m³; power stations, 89mn m³; industry 9mn m³ and exports through IUK 22mn m³.

At time of press (11.30 GMT) gas was meeting 45.6% of UK power generation mix and coal another 6.2%, so fossil fuels accounted for just over half. Wind was at about 17% of the mix. Demand was 45 GW.

Day-ahead prices at the UK hub, the National Balancing Point, closed February 8 at 57.5 pence/therm (p/th) ($7.94/mn Btu), compared with 47.35 pence/therm February 3. Then it was also possible to buy gas for delivery this week (February 8-12) for just 49.7 p/th, using the closing price as a guide. The March contract has also gone up, but not so much: from 47 p/th to 51.8 p/th.