Maritimes natural gas market : an overview and assessment

In 1987, Canada's National Energy Board (NEB) adopted a market-based procedure (MBP) to assess long-term gas exports. The MPB included monitoring and assessment of Maritimes natural gas markets. The NEB is responsible for interprovincial and international oil and gas pipelines as well as tolls and tariffs on NEB-regulated pipelines. The NEB is also responsible for electricity and natural gas exports and exploration programs on federally regulated lands not covered by an Accord agreement. The province of New Brunswick requested a new set of rules for the export of natural gas from the Maritimes to ensure competitiveness with other jurisdictions. The NEB decided that the public interest is best served by allowing the market to work. It also decided that the developing Maritimes market faces several challenges not faced by buyers in the export market. It was concluded that the market is working reasonably well to meet the needs of domestic consumers. 20 per cent of Scotian gas is being used in the Maritimes and many laterals have been constructed to extend service. Most major population centres have natural gas. However, there is no residential or commercial natural gas service in Nova Scotia, and only limited penetration of natural gas in residential and commercial markets in New Brunswick. Maritimers have a long history of using other fuel options and must make capital investment to switch to natural gas. They must, therefore, be convinced that investment will pay off in fuel savings and other benefits. The NEB will have to improve price transparency and strive for regulatory efficiency and cooperation with other jurisdictions. 2 figs