Cold weather north and south of the border is decimating natural gas storage and production in Western Canada. Today's update of the storage deficit shows that gas withdrawals are now 135 BCF greater than the previous winter. Proportionally, that's 2.35 x last year's draws. It has not abated at all in recent days, with yesterday's withdrawal exceeding 4 BCF, the second greatest single day draw of the season.
This will result in a significant reversion in cross border flows later in the year, as there won't be enough gas to sustain high exports to the US. On the other hand, it should rally the drilling rigs as AECO natural gas is now trading at significant premiums.
