Norwegian gas flows to Europe, UK post modest gains in October

06/11/2020 08:31 Natural Gas


Norway's pipeline gas imports into continental Europe and the UK in October posted modest gains on the previous month, reaching 8.43 Bcm.

While much of the planned summer maintenance on the Norwegian Continental Shelf that had impacted flows was completed, supplies were affected in the first part of October by strike action.


The strike by workers of the Lederne union, which ran from Oct. 5-9, took out around 35 million cu m/d of supply.


Nonetheless, deliveries in October still averaged 272 million cu m/d, the highest monthly average since March, the data showed.


Norwegian gas exports in January-October totaled 83 Bcm, the data showed, up marginally from the 82.7 Bcm a year earlier.


Norwegian flows have been more resilient this year than imports into Europe from Russia, which are around 20% lower year on year.


UK jump


Comparative European gas price movements also caused a change in flow dynamics in October.


Exports to the UK rose sharply last month to 2.64 Bcm -- the highest level since March and almost double the volumes supplied in September.


As a result, Norwegian gas exports to the Netherlands and Germany dropped, to 1.91 Bcm and 1.61 Bcm, respectively.


The UK NBP day-ahead contract enjoyed a premium over its Dutch TTF counterpart for most of October, driving more flows to the UK over continental Europe.


At times, the NBP day-ahead premium was more than Eur1/MWh above its TTF equivalent in October, according to S&P Global Platts price assessments.


In September, by contrast, the TTF day-ahead price was at a premium to NBP for most of the first half of the month.


Norway's main gas player, state-controlled Equinor, has said its sales strategy is very much dependent on prevailing European gas prices.


In July, Equinor's outgoing CFO Lars Christian Bacher said the company was continually optimizing its Norwegian gas portfolio.


"We are focusing on value over volume, and decisions are made more or less on a daily basis, dependent on the price," Bacher said.


Elsewhere in Europe, Norwegian gas deliveries to France totaled 1.13 Bcm last month, up 2% month on month.


Supplies to Belgium were 1.14 Bcm, also up 2% from September.

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