Winter expected to bring bigger natural gas bills.

Byline: Register-Guard and news service reports

With the price of natural gas 15 percent higher than a year ago, an industry trade group is warning consumers not to be surprised if home-heating bills are higher this winter.

While midyear concerns about inadequate supplies have abated in recent weeks, the Natural Gas Supply Association notes in a study to be released today that homeowners could be squeezed anyway this winter because utilities paid high prices this summer to replenish their inventories.

Natural gas that was bought and stored for this winter averaged $5.28 per 1,000 cubic feet, the study said. A year ago, the price was about $3.42.

While the study was careful not to give an actual price forecast, it cited analysts' projections of wholesale prices in the $4 to $6 per 1,000 cubic feet range throughout the heating season.

In Lane County, NW Natural, the main natural gas provider, has 27,000 residential customers, 4,600 commercial customers and about 40 industrial customers.

A prolonged cold snap could strain a tight supply, said William Transier, the association's chairman.

``The competitive market remains very vulnerable to the severity of the weather and the price volatility that a colder winter can bring,'' Transier said.

Last year, prices shot up because of low temperatures in the Northeast, Midwest and Mid-Atlantic states, where natural gas consumption is highest.

The National Oceanographic and Atmospheric Administration is predicting temperatures to be ``near-normal'' this year, the report noted.

While winter is the ``largest single factor affecting natural gas demand and customer bills,'' the report said weak demand for fuel in the struggling manufacturing sector could help moderate prices.

Another mitigating factor to the high-price scenario is the addition of new facilities to handle imports of liquefied natural gas, or LNG. For example, an LNG import terminal in Cove Point, Md., that hadn't been used in nearly a quarter-century reopened in July.

LNG imports are expected to double this winter to 1.54 billion cubic feet a day, or roughly 2 percent of winter demand, according to the study.

Fifty-five percent of U.S. homeowners heat their homes with natural gas, which is also used to produce electricity.

Strong demand last winter combined with dwindling domestic production led to springtime fears that the industry would not have sufficient supplies this year. The run-up in prices followed.

The report said winter storage of natural gas will be just below last year's level of 3.15 trillion cubic feet.

On Wednesday, natural gas for November delivery finished at $4.68 per 1,000 cubic feet, compared with $4.07 a year ago.