Quote:
Originally Posted by GP_Matt
Yes and No.
A lot of gas currently flows from BC into Alberta. A lot of this gas will now stay in BC and be exported instead of coming into Alberta. That is gas that was previously competing with Alberta gas and its absence from the system should help prices.
There are also hundreds of pipelines that currently flow gas between the two provinces and the entire system is integrated. The TransCanada line will start in Dawson and will connect to TransCanada network. This network currently flows into Alberta and can easily be reversed to pick up gas from the Peace region and beyond.
In the end the cheapest gas will go into the pipeline though, so if Alberta gas is cheaper than Horn River gas it will head west. Shell isn't going to drill a new well in Horn River if they can drill cheaper gas in Alberta. (Unless they want enough gas to take from both)
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Shell doesn't operate in Horn River. They do have an LNG terminal that I presume they'll be using Montney gas to supply an Asian contract.
Yes Alberta gas may (likely actually) be used in the export of gas to Asia, as these terminals have such large volume asks that producers will have to buy off the grid to fulfill commitments.
Even if no Alberta gas is used, again unlikely, the gas that is then re-routed from BC to Asia reduced supply to Alberta, and Alberta will have to make up the difference for North American demand that BC currently helps satisfy. We will see a rise in nat gas prices in the mid-long term depending on your definition.