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Outlook for Canadian Natural Gas, 2011: The Pipeline Companies

Monday, December 06, 2010

December 6, 2010

Canadian pipeline companies transporting western Canadian gas are slowly get squeezed out of the North American market, says a new report by Bentek, an energy analysis company based in Denver, Colorado.

Jack Weixel, Director of Energy Analysis for Bentek, says: "The utility of certain pipelines in Canada – of pipelines that are traditionally considered as export pipelines – that utility will drop."

Bentek’s report, titled "The Big Squeeze," states: "Planned pipeline expansions in the U.S. will unleash more supply from shale and other unconventional formations in the coming years."

There is nearly 10 Bcf/d of capacity planned for pipeline expansions or new builds designed to support the growth of the Marcellus and other supply from unconventional plays in the Southeast/Gulf and the Rockies.

Weixel says there are two squeezes going on for western Canadian gas. One is that gas from western Canada is being displaced by fast growing US shale gas production in the Marcellus shale of New York State in the east and Rocky Mountain gas in the west.

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