December 22, 2010 / 11:57 AM / 9 years ago

UK gas futures up on Norwegian LNG outage, storage

 * Statoil shuts Snohvit LNG plant, restart time unknown
 * UK gas storage could run out early Feb - trader
 LONDON, Dec 22 (Reuters) - British gas futures climbed on
Wednesday with concerns over storage levels and Norwegian
liquefied natural gas (LNG) production pulling prices up.
 Gas for January was up 1.15 pence at 59.15 pence per therm
($9.16 per mmBtu) at 1128 GMT while Summer 11 contracts were up
0.75 pence at 53.45 pence.
 Forward prices were firm following an outage at Statoil's
STL.OL Snohvit LNG plant due to a technical problem, with no
restart date confirmed.
 "It's really worrying as it comes at a time when there's
likely to be a lot of ships potentially coming to the UK from
Norway. This now leaves the UK a bit shorter for the coming
month," one gas trader said.
 Britain received two LNG tankers from Norway in late
November and early December, with high prices making it an
attractive destination for spot cargoes. [ID:nWLA8681]
 Traders also said UK gas storage was still being used, which
was also raising prices for contracts further out.
 "Storage is still withdrawing, prices are still telling
people to withdraw. Assuming there're no injections over the
Christmas period, we'll have around 36 days of storage come the
begining of January," another gas trader said.
 Traders said thin trade was also making prices volatile,
with volumes down as market participants closed positions before
the Christmas break.
 In the spot market, gas prices were range-bound with ample
supply from North Sea gas fields and LNG terminals meeting high
consumption from heating demand.
 Gas for Thursday was trading between 62.65 - 63.50 pence
early in the session, according to one broker.
 In the over-the-counter (OTC) power market, prices continued
to ease in the run up to Christmas, with baseload electricity
for Thursday down 4 pounds at 51 pounds per megawatt-hour (MWh).
 The N2EX power exchange settled the auction price for
Thursday slighly above the OTC level at 52.52 pounds.
 (Reporting by Kwok W. Wan; editing by James Jukwey)

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