Canadian natural gas facing "big squeeze."
Western Canadian gas exports to the United States could be completely displaced into Northern California by abundant, low cost US natural gas production, and by several new gas pipelines in the US, says a new market study by Bentek, a US energy analysis company.
Overall, Canadian gas exports to the US will drop 2 bcf/d over the next few years – almost 30% – and this impending loss of the northern California market builds upon the loss that western Canadian gas has in lower exports to the US northeast.
Increased Canadian demand and declining Canadian supply will pick up some of the slack, but it won’t be enough to offset a significant loss of exports to the US market in the near term, they add.
Bentek’s report, titled “The Big Squeeze,” is a report that also outlines how fast growing production from the Marcellus shale in Pennsylvania is displacing Canadian gas to the lucrative Northeast US market, and how new pipeline capacity carrying low cost gas out of the Rocky Mountains is now set to displace much of Canadian gas to the US Midwest and lucrative California markets.
“What we outlined in our study was complete displacement of Canadian gas into Northern California by the summer of 2014,” says Jack Weixel, Director of Energy Analysis for Bentek
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