The AECO Hub™ is Niska’s commercial natural gas storage business in Alberta, Canada. It is now comprised of two separate facilities:
Gas that is delivered from the Nova system, into connected storage, does not pay a second toll to get back on the Nova system to continue on to its destination. Thus customers do not incur incremental transportation charges to make use of AECO storage.
The Nova system has a ‘virtual’ trading point, notionally in the center of its system, equally accessible to all the gas being transported on its system. Called Nova Inventory Transfers, or ‘NIT’, by the pipeline, industry still commonly refers to the Alberta trading point as ‘AECO’. That is because title transfers were first provided as a ‘hub’ service at the first AECO facility (Suffield) in the early 1990s, before that service was available on the pipeline. So many transactions were quickly being done there, by storage customers and others, that a price index was developed to facilitate price discovery. Called the AECO C Hub Price Index, the ‘AECO Price’ became the commonly used term to refer to Alberta spot prices. This is just one example of how the AECO Hub™ has always been a leader in the provision of innovative storage, and storage related, services.
Approximately 10 BCF per day of gas is produced into the Nova system each day in Alberta. That volume is traded many times over most days by the marketing community. So tremendous liquidity is available at the AECO/NIT trading point to customers of the AECO Hub™.
Although the two AECO facilities are geographically dispersed across Alberta (see location), the toll design of the Nova Gas Transmission Limited pipeline system means that they are both, commercially, at the same point. The two facilities, each comprised of multiple reservoirs and compression plants, represent the ultimate in flexibility and reliability. Combined with the high liquidity and accessibility to most market regions, the AECO Hub™ is the best storage bargain in North America.
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