UK Gas Demand Halves on Mild Weather, Strong Wind
UK gas demand has more than halved since the cold spell earlier this month, according to daily data from National Grid February 23. Local distribution zone demand, reflecting households and small commercial sites, was showing 190mn m³ February 23, compared with over 400mn m³ a few weeks ago when the temperature was below zero in large and densely populated parts of the UK for over a week.
Power station demand for gas was also low, and projected to reach about 40mn m³/day, compared with about 80mn m³ earlier in the winter as the wind has picked up strength. Gas was accounting for just under 30% of the mix at time of press and wind just over 30%, whereas earlier in the month, and with greater power demand, gas was accounting for just over half the mix, while wind dropped on occasion below 10%. Industrial demand was 8mn m³/day.
Norway accounted for about a third of UK supply for February 23, flowing a little under 70mn m³/day, with LNG from the two Milford Haven import terminals coming in second with some 52mn m³/day between them.
Flows to northwest Europe may have picked up lately as LNG spot prices in Asia have come down to more normal levels, of about $6.00/mn Btu for April delivery, or about a fifth of where it traded for spot delivery earlier in the winter. And with Dated Brent crude at $63/barrel, term LNG would cost about the same as spot in Asia for April delivery applying a 10% discount.
The three subterminals at St Fergus were each receiving about 15mn m³/day. Exports from the UK to the continent through Interconnector UK were running at about 12mn m³/day or about half capacity, reflecting the higher price of gas on the mainland.