Gas competition intensifies at Canada’s Dawn Hub

By Abhishek Kumar 29 March 2017
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The East Consuming Region (ECR) of Canada relies heavily on pipeline gas imports from the west of the country and from the United States. However, gas from western Canada is struggling to maintain its attractiveness in the east as supplies are increasing from US shale plays such as the Marcellus and the Utica, which in turn will increase competition for the fuel at the Dawn Hub in Ontario.

The ample gas supplies entering the Dawn market will also tighten Canada’s East-West gas price spread (the difference between the Dawn and AECO hub prices) during April, making it less profitable to export gas from western Canada. The spread has averaged $0.6/MMBtu so far in March, unchanged from the average seen in March 2016.

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