UK Markets closed

UK GAS-Prices firm as Norwegian outages leave network undersupplied

* Spot gas prices dip 0.65 pence, to 33.90 p/therm

* Norwegian exports to UK see sharp reductions

June 29 (Reuters) - British wholesale gas prices rose on Wednesday as production outages in exporter Norway left the transmission grid undersupplied.

Gas for immediate delivery rose 0.65 pence per therm to 33.90 p/therm by 0820 GMT, while the day-ahead contract traded at 34.25 p/therm, up 0.55 p/therm.

The gas network was undersupplied by 6 million cubic metres/day (mcm), according to National Grid (LSE: NG.L - news) data, with daily demand estimated at 159.4 mcm/day.

Imports from Norway declined to 16 mcm/day from 25 mcm/day in the previous session owing to production disruptions at Norwegian gas fields Valemon and Heimdal, which are expected to resume full service by Thursday.

Domestic gas output is expected to rise from around 1200 GMT, when Centrica (LSE: CNA.L - news) 's Morecambe gas sub-terminal resumes deliveries following a planned outage.

"Demand levels remain largely steady at 160 mcm, a tick up in local distribution zone consumption forecasts being offset by lower export and gas power plant (needs)," Marcel Boonaert, head of trading and portfolio at Wingas UK.

The Britain-Belgium gas pipeline is expected to reopen on Thursday following a period of planned maintenance that curtailed the UK's ability to flow gas to the continent.

Thomson Reuters (Dusseldorf: TOC.DU - news) gas analyst Oliver Sanderson sees exports from Britain to Belgium through the pipeline hitting 15 mcm/day on Wednesday.

Last week's shutdown of Britain's Rough gas storage site, the country's largest, for at least 42 days has led to a drop in overall demand because it is not possible to replenish stored reserves.

Further along the curve, the contract for gas delivery next-month rose 0.12 pence to 33.70 pence/therm, while the benchmark winter 2016 contract rose 0.35 pence/therm at 42.65 pence/therm.

In the Netherlands, the day-ahead gas price at the TTF hub rose 0.19 euro to 14.32 euros per MWh.

In the European carbon market, front-year allowances fell more than five percent earlier in the session, down 0.22 euro to 4.47 euros a tonne. (Reporting by Oleg Vukmanovic; editing by Louise Heavens)

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting