September 23, 2010 / 10:52 AM / in 7 years

UK gas prices rise again on low supply, cold

LONDON, Sept 23 (Reuters) - British gas prices continued to rise on Thursday as flows from liquefied natural gas (LNG) terminals and Norway remained low and colder weather looked set to spread across the country over the weekend.

Gas for day-ahead delivery rose to 43.75 pence per therm by 1020 GMT, with temperatures expected to drop sharply on Friday in many parts of a country where gas is largely used for heating, while prices for weekend delivery firmed to 43.60 pence, up 0.70 pence.

Despite flows through Norway’s Langeled gas pipeline remaining unusually low at under 10 million cubic metres per day, there was no supply from the Isle of Grain or Dragon LNG terminals, and although South Hook LNG was healthy it wasn’t enough to dampen prices which have rallied all week. <#NGRID-FLO-SYS>

Norwegian pipeline operator Gassco said there were no operational issues on Thursday other than the ongoing maintenance outage at the Kollsness export plant, which is expected to end on Monday. [ID:nLDE68L1EQ]

Front-month October also rose, up 0.35 pence at 43.65 pence, while Winter 2010 contracts were up 0.40 pence to 48.25 pence per therm, recovering from a sharp drop in prices from Sep. 16 to Sep. 20. GS2NBH1

The British power market rose in line with stronger gas, a fuel used to make about half of Britain’s electricity, with October baseload contracts up about 20 pence at 41.60 pounds per megawatt hour and November baseload similarly stronger at 43.30 pounds.

Weighing on the prompt, National Grid data showed a power generation unit at Drax -- Britain’s biggest coal plant -- was restarted on Thursday morning. <0#UKBM-COAL> (Reporting by Daniel Fineren; Editing by Alison Birrane)

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