California natural gas prices spiked to a five-month high after state regulators approved rules to help gas utilities manage the amount of fuel flowing in pipelines due to the ongoing outage of the Aliso Canyon underground storage facility.
Next-day prices at the Southern California Border W-SOBOR-IDX jumped over 35 percent so far this week to $2.28 per million British thermal units, the highest level since January.
To avoid fines, some traders said they were increasing the amount of gas they put into the system, causing the price rise.
In October, Southern California Gas, the nation’s biggest gas distribution utility, detected a major leak at Aliso Canyon. The facility, located about 30 miles (48 km) northwest of Los Angeles, is the second biggest storage field in the western United States, according to federal data.
SoCalGas is a unit of California energy company Sempra Energy.
SoCalGas plugged the leak in February, but Aliso Canyon remains shut while the company inspects all of the facility’s 114 wells. The company said in April it hopes to partially restore the facility to service by the end of the summer.View Article