The Sumas trading point on the Canada-Washington border averaged $161.33 per million British thermal units on its natural gas spot prices on March 1. This is the highest daily spot price ever recorded by Natural Gas Intelligence anywhere in the United States in at least five years. The price peak was due to regional supply constraints and unseasonably cold temperatures.
Specifically, EIA addresses that the high demand happened at the same time with an unusual high demand, when the polar vortex moved into the region in the first days of March.
Because of this weather phenomenon, temperatures in Washington state averaged 33 degrees Fahrenheit (°F) from March 1 through March 4, 10°F lower than normal.
These temperatures led to high heating demand in the Pacific Northwest and neighboring areas of the Rockies and Western Canada, regions that supply the Pacific Northwest with natural gas.
The October 2018 explosion on Enbridge’s BC Pipeline led to reduced flows and higher prices at the Sumas trading point throughout the 2018–2019 winter.
From November through February, the daily flow through Sumas onto Williams’s Northwest Pipeline in Washington averaged about 610 million cubic feet per day (MMcf/d), about one-third lower than the same period in the previous year.
Sumas prices averaged $10.56/MMBtu during that period compared with $2.62/MMBtu a year earlier.
During winter, the natural gas supply shortfalls in the Pacific Northwest were met by withdrawing natural gas from the Jackson Prairie storage facility in southwest Washington and by changing regional pipeline flows to bring additional natural gas into Washington and Oregon.
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Another factor that affected the prices at that period was that the BC pipeline was expected to operate at reduced capacity during inspections related to the October explosion. These inspections were scheduled from February 27 through March 6, 2019.
On March 1, the spot prices for the weekend were set with the expectations that pipeline capacity reductions would last through the following Wednesday, March 6. Natural gas prices spiked to $161/MMBtu on, March 1, ten times what they were on the previous Friday.
Concluding, when the BC Pipeline inspection ended early, on March 2 and temperatures began to increase, Sumas prices fell to $15.63/MMBtu on Monday, March 4. Maintenance at the Jackson Prairie storage facility was completed by March 7, and since March 8, Sumas prices have averaged less than $4/MMBtu.
