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Natural gas imports from Canada provide winter reliability

Published by , Editorial Assistant
World Pipelines,

Despite the downward trend in natural gas imports from Canada, trade between the US and Canada remains important in balancing US natural gas markets and helps ensure reliable supply to parts of the US. Because of ample capacity on pipelines and in storage facilities in Canada, suppliers can rapidly increase flows, which helps to stabilise the US market during periods of supply and demand imbalance, such as during cold winter months.

Natural gas imports from Canada provide winter reliability

In 2005, 17% of total US supply of dry natural gas was imported from Canada. Since then, Canada’s share of imported dry natural gas supply to the US has declined because US domestic natural gas production has grown. As of the end of August, gross imports of dry natural gas from Canada accounted for, on average, 8% of US supply, and US natural gas production averaged 92%, or 97 billion ft3/d, according to the EIA’s ‘Natural Gas Monthly’.

During the same time period, US pipeline exports of natural gas to Canada have increased. In 2000, US exports averaged 2% of all pipeline natural gas trade with Canada. In 2005, that share increased to 9%. Through August of this year, it averaged 24%.

Natural gas imports from Canada to the western US have provided a steady source of supply and have been increasing. So far this year, they have increased 4.1% compared with the same period in 2021. The border-crossing points at Sumas, Washington, and Eastport, Idaho, principally supply metropolitan areas in the Pacific Northwest and California, where several factors have challenged supply and demand balances this year:

  • More demand for electric power to run air-conditioning due to sustained high temperatures and an extreme heat wave this summer.
  • Less hydroelectric power generation due to drought.
  • Reduced natural gas inflows from the Permian Basin due to pipeline constraints.

Natural gas pipeline capacity has expanded throughout the eastern US, and the region is typically a net exporter of natural gas to Canada for much of the year. Imports from Canada, however, help support annual seasonal fluctuations in consumption, particularly during the winter peak in the US, when cold temperatures drive demand for heating. Since 2012, imports into the eastern US have generally peaked in January or February at approximately 2 billion ft3/d and then again in July or August at approximately 1 billion ft3/d, when high temperatures drive demand for air-conditioning. During the shoulder seasons (spring and fall), net flows of natural gas reverse, flowing into Canada to build inventories.

During Winter Storm Uri in February 2021, US natural gas production had record declines, and imports from Canada increased to 9.5 billion ft3/d to meet US demand, the highest monthly average since February 2011.

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