CALGARY — Natural gas producers in Western Canada have white-knuckled it through months of depressed prices, with the expectation that their fortunes will improve when LNG Canada comes online in the middle of next year.
But the supply glut plaguing the industry this fall is so large that not everyone is convinced the massive facility's impact on pricing will be as dramatic or sustained as once hoped.
"As a producer, it would not be economic to have produced that gas . . . It's been pretty worthless." Mike Belenkie, CEO of Calgary-headquartered natural gas producer Advantage Energy Ltd., said companies have been ramping up production in spite of the poor prices in order to get ahead of the opening of LNG Canada. The massive Shell-led project nearing completion near Kitimat, B.C. will be Canada's first large-scale liquefied natural gas export facility.
"And so we have this temporary period of time where there’s more gas than there is places to put it.” "We cut all our gas growth out of 2024, once we’d had that mild winter. We did that back in Q2, because this is not the right year to bring incremental molecules to AECO," said Mike Rose, CEO of Tourmaline, which is Canada's largest natural gas producer, in an interview this week.LNG Canada is expected to process up to 2 billion cubic feet of natural gas per day once it reaches full operations.
"Our thinking is that markets will be healthy for six months, a year, 18 months — whatever it is — and then after that 18 months, because prices will be healthy, supply will grow and probably overshoot demand again," he said, adding he's frustrated that more companies haven't done what Advantage has done and curtailed production in an effort to limit the oversupply in the market.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Natural gas producers await LNG Canada's start, but will it be the fix for prices?Natural gas producers in Western Canada have white-knuckled it through months of depressed prices, with the expectation that their fortunes will improve when LNG Canada comes online in the middle of next year.
Read more »
Natural gas producers await LNG Canada's start, but will it be the fix for prices?Natural gas producers in Western Canada have white-knuckled it through months of depressed prices, with the expectation that their fortunes will improve when LNG Canada comes online in the middle of next year.
Read more »
Natural gas producers await LNG Canada’s start, but will it be the fix for prices?The supply glut plaguing the industry this fall is so large that not everyone is convinced the massive facility’s impact on pricing will be as dramatic or sustained as once hoped
Read more »
Natural gas producers await LNG Canada's start, but will it be the fix for prices?CALGARY — Natural gas producers in Western Canada have white-knuckled it through months of depressed prices, with the expectation that their fortunes will improve when LNG Canada comes online in the middle of next year.
Read more »
Natural gas producers await LNG Canada's start, but will it be the fix for prices?CALGARY — Natural gas producers in Western Canada have white-knuckled it through months of depressed prices, with the expectation that their fortunes will improve when LNG Canada comes online in the middle of next year.
Read more »
Canadian natural gas firms eager for LNG boom to swamp market with excess supplyThe slump has hurt producers who boosted drilling activity this year in anticipation of new demand from LNG Canada and prompted some firms to curtail production
Read more »