Britain-to-Belgium gas flow via the Interconnector pipe was expected to hit a 38-month high on Wednesday, driven by a falling British NBP Day-ahead price compared to its Belgian equivalent on Tuesday.
The premium of the Belgian Zeebrugge Day-ahead contract over the NBP Day-ahead, called the basis, is a major driver of the direction of gas supply between the two countries. If the basis is higher than -1.90p/th, it typically incentivises shippers to send gas from Britain to Belgium. A positive basis typically causes high flows.
Wednesday’s record flows were driven by a falling British NBP Day-ahead contract, which dropped at a faster rate than its Belgian equivalent on Tuesday, and caused a higher Zeebrugge Day-ahead basis. The Zeebrugge contract was supported by upcoming Norwegian maintenance.
Shipper nomination data from operator IUK at 13:00 London time showed 634GWh, equivalent to 59 million cubic metres, of gas was set to flow from Britain’s Bacton to Belgium’s Zeebrugge on Wednesday.
Should the nominations be fully delivered, British gas exports to Belgium through the Interconnector would be their highest since June 2013.
Flows would also exceed the official maximum technical capacity of the pipe of 630.1GWh. An operator at IUK said it is possible to push flows through at above this level, as long as the prevailing conditions are favourable.
The highest daily flow through the Interconnector in the Britain-to-Belgium direction was 644GWh, recorded on 8 April 2011.
Wednesday’s record flows were driven by Tuesday’s Zeebrugge Day-ahead basis of 2.25p/th, the highest basis for 26 months.
Early trading on Wednesday suggested Thursday’s flows could match, or even exceed, Wednesday’s level. The basis traded at 2.45p/th on Wednesday morning at 10:28, 0.20p/th higher than Tuesday’s closing ICIS assessment.
Flows should remain strong for the next week or so to offset curtailed supply from Norway (see separate story). The Zeepipe, which brings Norwegian gas to Belgium, is scheduled to shut down for annual maintenance between 2-7 September, according to Norwegian operator Gassco.
The September basis traded at -0.20p/th on Wednesday morning, 0.225p/th higher than Tuesday’s close. email@example.com