Natural gas jumps due to Japan nuclear crisis

A combination of handout satellite images show the Fukushima Daiichi nuclear plant on November 21, 2004 (L) and on March 14, 2011 (R) as the No.3 nuclear reactor is burning after a blast following an earthquake and tsunami. Natural gas prices rose Monday on expectations of increased Japanese demand to make up for the loss of the reactors.Photograph by: HO, DIGITALGLOBECanadian natural gas prices jumped Monday on speculation nuclear power will fall out of favour as a safe way of generating electricity in the wake of Japan's nuclear crisis.

Export prices at trading hubs that clear Canadian gas exports into the U.S. were up around five per cent, according to the Natural Gas Exchange website, while North American spot prices climbed above $4 US per million British thermal units in New York before falling back to $3.91, up about three cents on the day. European gas prices shot up even further amid speculation that Japan would increase imports of liquefied natural gas (LNG) to make up for the loss of nuclear reactors damaged in Thursday's 9.8 earthquake. Japan was already the world's largest LNG importer, consuming about 35 per cent of the world's supplies.

Canadian experts said the unfolding disaster combined with low natural gas prices all but spells the deathknell for nuclear power in Canada. According to Tom Adams, an electricity expert and consultant based in Ontario, the economics of nuclear power were already challenged by abundant shale gas supplies. After the incidents in Japan, Adams predicted there will be no new nuclear reactors built in Canada, including a proposed facility in Alberta, and in fact attention might shift to retiring Canada's nuclear fleet as quickly as possible.

"The future of nuclear power is highly questionable," he said in an interview. "All those questions about reactor safety are back on the table." According to Adams, the Japanese nuclear industry was considered to be the world's "gold standard" and the weekend's incidents will convince many that there is no safe way to operate a nuclear reactor.

"This is not like Chernobyl, where you had a bunch of drunken commies doing a bunch of things that were obviously stupid. This is a fall from grace from the top of the top, the best of the best," he said. Bruce Power, a joint venture between Calgary-based TransCanada Corp., Saskatchewan's Cameco Corp. and a coalition of Ontario pension funds and labour unions, will likely be forced to rethink plans for a reactor in the Peace River region of northern Alberta, CEO Duncan Hawthorne told the CBC Monday. Courtasy:CALGARY HERALD