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Updated June 2021

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Highlights of 2020

Henry Hub: The primary price benchmark for U.S. natural gas decreased by 17 per cent in 2020, averaging US$2.13 per million British thermal units (MMBtu). The decline in Henry Hub price was largely associated with high levels of associated gas production from high U.S. oil production. The price is expected to increase as demand and exports grow.

AECO-C: The AECO-C price benchmark for western Canadian natural gas increased 29 per cent from 2019, to an average of Cdn$2.07 per gigajoule (GJ). In contrast with prices that fell during the onset of the COVID-19 pandemic, such as Henry Hub, the AECO-C price increased as Alberta’s natural gas inventories were at multiyear lows.

Price differential: The price differential between AECO-C and Henry Hub narrowed to $0.50/MMBtu in 2020, down from US$1.29/MMBtu in 2019, and US$1.95/MMBtu in 2018.

Table 1.2 shows the historical and forecasted Henry Hub and AECO-C natural gas prices.

Highlights for 2021 to 2030

Henry Hub: The Henry Hub price is projected to increase to US$3.01/MMBtu in 2021 and to US$4.14/MMBtu by 2030. Demand is anticipated to increase, primarily driven by growth in U.S. liquefied natural gas (LNG) and pipeline exports.

AECO-C: The AECO-C price is projected to gradually increase over the forecast period from Cdn$2.83/GJ in 2021 to Cdn$3.87/GJ by 2030.

Price differential: The price differential between AECO-C and Henry Hub reflects transportation differentials, regional supply and demand balances, infrastructure constraints, and the U.S./Canadian dollar exchange rate. The AECO-C and Henry Hub price differential is anticipated to average about US$0.70 in 2021, increase to 0.80/MMBtu by 2023, and remain at this level to 2030.