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Norway will keep the UK warm this winter with gas supply boost

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LONDON (Bloomberg) — Britons won’t have to worry about staying warm this winter and they have Norway to thank.

Natural gas imports from Norway are expected to increase October through March by as much as 18 MMcmgd (635 MMcfgd), or 15%, from a year earlier, according to a forecast released Friday by UK gas system operator National Grid Plc. They are estimated to be between 60 MMcmgd and 136 MMcmgd.

The gain reflects a broader decline of domestic gas supply in the UK, a net exporter of the fuel until 2003. Flows from the British continental shelf may fall 4% this year to as low as 70 MMcmgd. Supplies of Dutch and Belgian fuel, as well as LNG imports are also expected to increase.

“Based on our preliminary analysis, we expect there to be sufficient gas supplies available to meet demand for winter,” according to the report. “Great Britain’s gas demand is expected to be met from a wide range of supply sources.”

Norway, Europe’s biggest supplier of gas after Russia, reached a record production of 117.2 Bcm last year as European demand rose. The country will produce similar levels in the next few years, according to Statoil ASA, Norway’s biggest producer.

Rough outage

National Grid said that while the UK does face some restrictions for supply this winter, including a 42-day outage at its largest storage facility Rough, it will have plenty of gas to keep Britons heated. The UK has as much as 605 MMcmgd available for next winter.

If Rough returns to service at the beginning of August, as expected, it will be full in time for winter. If it’s not, National Grid is able to increase imports. Additionally, Europe’s largest gas field, the Groningen reserves in the Netherlands, faces mandatory output cuts after extraction at the site was tied to earthquakes.

National Grid said Groningen is allowed to increase production sufficiently during a particularly cold winter. Weak demand is also adding to a comfortable supply picture, according to the system operator. There hasn’t been a particularly cold day, where demand reaches above 400 MMcmg, during the last four winters.

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