http://siliconinvestor.advfn.com/readmsg.aspx?msgid=24668979
To: CommanderCricket who wrote (102650) 6/11/2008 11:28:02 PM
From: ChanceIs of 102664
UPDATE: UK Gas Supplies Next Winter Uncertain -Natl Grid
>>>Florida needs NG!?!?! So does the UK, and I think that Florida might just be outbid. See especially the highlights.<<<
DOW JONES NEWSWIRES
June 10, 2008 1:38 p.m.
(Updates with detail, background)
LONDON (Dow Jones)--As U.K. natural gas prices hit new highs, gas and power network operator National Grid PLC (NGG) said Tuesday that supplies for next winter are uncertain due to difficultly forecasting trade flows in liquefied natural gas and doubts over how much Norwegian imports could grow in the year ahead.
National Grid's initial expectation for U.K. gas supply next winter, excluding gas held in storage, is 300 million to 450 million cubic meters a day, a much wider range than usual.
It is unclear if two new LNG import terminals will be ready in time, National Grid said in its winter outlook report. The number of cargoes that will be delivered to them is even more uncertain, it said.
"U.K. and continental (European) gas prices are higher than those in the U.S., providing an incentive to deliver spot LNG cargoes to Europe. However as experienced last winter, the Far East may be again prepared to pay a premium to secure LNG cargoes," the report said.
Gas flows from LNG imports into the U.K. could be anywhere between zero and 83 mcm/day, the report said.
"From Norway we anticipate higher U.K. imports as Ormen Lange production builds up, however we acknowledge the potential for higher deliveries to the Continent at the expense of the U.K.," it said. Average flows could be between 80 mcm/day and 115 mcm/day, it said.
National Grid's report comes a day after the price of gas for delivery next winter rose above 100 pence a therm for the first time. The winter contract has risen almost 70% this year, driven largely by record oil prices.
Much of the gas traded in Europe is priced on long-term contracts in relation to oil, which in turn influences the free-floating U.K. gas price.
U.K. utilities are widely expected to impose a second increase on their customers' gas and electricity bills this year to make up for rising wholesale prices.
The top three energy suppliers by customer numbers - Centrica PLC (CNA.LN), Scottish and Southern Energy PLC (SSE.LN) and E.ON U.K., a subsidiary of E.ON AG (EOA.XE) - have hinted that they will raise prices.
Price comparison service uSwitch predicts the average household gas and electricity bill in the U.K. could be GBP1,327 by the end of 2008, an increase of 45.3% from the beginning of the year.
National Grid forecast lower demand for natural gas for power generation this winter, due in part to its high price. Electricity supplies are broadly unchanged from the previous year, and sufficient to meet demand, it said.
National Grid expects domestic U.K. gas production to be 10% lower this winter, compared to the previous year.
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