Part of Natural gas

Natural gas price variables

Natural gas prices are set in an open and competitive market and are influenced by many variables throughout North America.


There are many variables that influence natural gas prices in North America.

These include:

  • supply and demand
  • production and exploration levels
  • storage injections and withdrawals
  • weather patterns
  • pricing and availability of competing energy sources
  • market participants’ views of future trends in these and other variables

Pricing benchmarks

There are several pricing benchmarks in the natural gas market.

New York Mercantile Exchange (NYMEX)

The NYMEX natural gas futures contract is widely used as an international benchmark price. It is used here in Alberta. The futures contract trades in units of 10,000 million British thermal units (MMBtu).

The price is based on delivery at the Henry Hub in Louisiana. This is the centre of 16 intra- and interstate pipeline systems that draw from the region’s gas deposits. The pipelines serve markets throughout the U.S. East Coast, Gulf Coast and Midwestern U.S.

The NYMEX does not set the prices of the traded commodities. Market forces determine prices through open and continuous auction on the exchange floor.


The AECO “C” spot price is the Alberta gas trading price. It has become one of North America’s leading price-setting benchmarks.

To find the AECO-C spot price and other market prices, go to Natural Gas Exchange (NGX).

Alberta natural gas reference price

The Alberta natural gas reference price is a monthly weighted average field price of all Alberta gas sales. This information is determined by the Alberta Department of Energy and Minerals through a survey of actual sales transactions. This price is used for royalty purposes.

Natural gas utility gas cost flow-through rates

In Alberta, 2 major companies are responsible for providing regulated natural gas service. They are:

Their natural gas rates are set at the beginning of each month, subject to verification by the Alberta Utilities Commission. These rates reflect the forecast market price for the upcoming month. They correct for any amount that is over- or under-collected from previous months.

Natural gas rates are “passed through.” This means the gas rate reflects the costs to purchase natural gas and the costs involved with managing that gas supply.

There is no profit or mark-up on regulated natural gas rates.

The Natural gas prices fact sheet explains consumer pricing.


Connect with Gas Royalty Operations:

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Email: [email protected]

Alberta Energy and Minerals
Gas Royalty Operations
7th Floor, North Petroleum Plaza
9945 108 Street
Edmonton, Alberta  T5K 2G6


Email: [email protected]

Alberta Energy and Minerals
Pricing and Analysis
Centennial Place
1050, 250 5 Street SW
Calgary, Alberta  T2P 0R4