UK's winter gas at risk from shaky Norway exports
* Norway outages collide with start of heating season
* Qatari LNG supplies to UK also down sharply
* UK spot gas prices up 10 pct since beginning of Oct.
By Henning Gloystein
LONDON, Oct 11 (Reuters) - Britain's winter gas supply may hit a crunch in a cold snap after volatile imports from Norway due to technical problems compound variable shipments from Qatar.
Norway's exports have left Britain's gas system short at the beginning of the winter season, which started on Oct. 1, and pushed up prices by almost 10 percent since the beginning of the month.
"Technical flaws are not really uncommon, but the export troubles at the beginning of the winter season highlight just how tight Britain's gas system is. Imagine what will happen if we have similar outages during a real cold snap," one gas trader said.
Norwegian gas exports have suffered in recent weeks as outages at gas processing plants serving the massive Ormen Lange field have interrupted supplies following maintenance work.
Although traders say that such outages are fairly common after prolonged work at large gas fields, they warned that the tight system bodes ill for times when demand really shoots up during harsh cold later, especially should Qatari supplies of liquefied natural gas (LNG) not pick up soon.
"Winter starts with a bang ... a power outage at the Norwegian gas-processing plant at Kolsness showed how important Norwegian gas has become for the UK market," Barclays Capital said in a research note this week.
National Grid data shows that gas demand in Britain has risen from around 20 to 30 percent below the seasonal norm during most of this year to just 5 to 10 percent below average since the beginning of the month.
During the low demand summer period the system was already tight, and traders are now concerned what might happen now that demand is up but imports from Norway and Qatar are down.
British spot gas prices have already risen from under 59 pence per therm to over 64 pence since the beginning of October, which market the start of the new gas year.
This is their highest level since a cold snap across Europe interrupted Russian gas exports last February and briefly sent gas prices to almost 100 pence a therm.
Analysts also said that a sharp drop in LNG supplies to the UK, on which Britain increasingly depends to replace its own dwindling production, were a concern.
"The last (LNG) cargo seen to both South Hook and Isle of Grain was last Monday and there are currently no new cargos observed heading for UK so far in October. We expect to see continuous low send outs from both terminals throughout October," analysts at Thomson Reuters Point Carbon said.
BarCap said that the tight LNG market would add "even greater stress on pipeline gas," and that there were limits to the volumes increases Norway would be capable of sending to Britain, "skewing price risks to the upside." (Reporting by Henning Gloystein, editing by William Hardy)
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