UK spot gas prices ease as new gas year starts
* Fundamentals weigh on trade volumes, volatility
* Kollsnes maintenance extended to Tuesday
* Norway expects total gas output at 334.2 mcm/day in Oct
LONDON, Oct 1 (Reuters) - British prompt gas prices fell on Monday morning, shrugging off a temporary halt in flows from Norway through the Langeled pipeline as wider supply-demand fundamentals sapped trading sentiment.
Low trading volumes and flexible sources of UK supply kept a leash on price volatility as the new gas year began on Oct. 1. Gas for Tuesday delivery edging 0.10 pence lower to 58.50 pence a therm.
The first day of the winter 2012/2013 gas trading season, which also kicked off on Monday, displayed comfortable supply and demand fundamentals more akin to the summer season, traders said, although that could change heading deeper into winter.
Gas prices for the rest of the week fell 1.25 pence to 58.65 pence.
Flows via Norway's Langeled pipeline resumed hours after unexpectedly hitting zero earlier on Monday, confirming expectations by several traders that the halt was temporary.
Langeled was pumping 18.50 mcm/day at 0915 GMT.
Maintenance at Norway's Kollsnes gas processing plant was extended by two days to Tuesday following a compressor failure.
The return of the Vesterled pipeline at midnight offset concerns caused by extended maintenance at Kollsnes with the line pumping 27 mcm of gas per day to the UK.
"It looks like Europe will get less gas due to the extended maintenance at Kollsnes, but the supply situation in the UK looks healthy right now," one trader from a major British utility said.
The Norwegian Petroleum Directorate forecasts total gas production this October to be around 334.2 mcm/day.
Analysts at Point Carbon expect 280 mcm/day of that production to arrive in Britain and Norway during the month, with 70 mcm/day earmarked for UK markets and the rest heading for the continent.
Britain should receive 50 mcm/day via Langeled, 15 mcm/day via the FLAGS pipeline and 5 mcm/day via Vesterled, according to Point Carbon's forecast.
"The average Langeled flows in October 2010 and 2011 were 58.9 and 42.3 mcm/day, respectively," the analysts said.
The transmission network was oversupplied by 14 mcm/day despite higher predicted residential demand for gas-fired heating as temperatures dipped across the UK.
Further out on the curve, the new front-season summer 2013 contract fell by 0.35 pence to 60 pence as weak demand weighed on sentiment.
In Britain's over-the-counter power market, day-ahead prices were little changed at 42.30 pounds per megawatt-hour, down 33 pence on the previous session.
(Reporting by Oleg Vukmanovic; editing by Jason Neely)
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