April 12, 2012 / 6:23 PM / in 6 years

Canadian spot natgas at 10-year low on weak demand

CALGARY, Alberta (Reuters) - Canadian spot natural gas fell to its lowest in a decade on Thursday despite a bullish storage report, as mild temperatures in most markets continued to limit demand for the fuel.

Spot gas at the AECO storage hub in southeastern Alberta fell 12 Canadian cents to average C$1.51 a gigajoule, the lowest since July 2002. Deals were done between C$1.48 and C$1.55 a GJ.

In its weekly report, the U.S. Energy Information Administration report said gas inventories rose 8 billion cubic feet to 2.487 trillion cubic feet last week. Traders and analysts polled by Reuters had expected a rise of 25 bcf.

In Canada, stocks were nearly unchanged last week, dropping just 100 million cubic feet to 492.5 bcf, Canadian Enerdata reported. Canadian storage facilities ended the week 69.6 percent full. A year earlier they were at 27.4 percent of capacity.

Environment Canada said low temperatures in Toronto will be close to normal or a few degrees warmer than average over the next week. Southern Alberta lows will be mostly warmer than the seasonal average through Wednesday.

The U.S. National Weather Service’s 6- to 10-day outlook issued Wednesday again called for above-normal readings for about the eastern third and western third of the nation and some below-normal readings across the mid-Continent.

Alberta’s main pipeline system ran at 16.46 billion cubic feet, 343 million cubic feet below operator TransCanada Corp’s (TRP.TO) target line pack.

Producers delivered 10.25 bcf into the system and a net 343 mmcf was injected into storage facilities in the province.

Export prices also weakened. Spot gas at Niagara, for shipment into the U.S. Northeast, fell 3 cents to average $2.29 per mmBtu.

Spot gas at Huntingdon-Sumas on the British Columbia-Washington border averaged $1.78 per mmBtu, down 5 cents.

Reporting by Scott Haggett

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