UPDATE 1-U.S. natgas futures drop 3 pct after six straight gains
* Front month below Tuesday's 2012 high
* Nuclear power plant outages still strong
* Cooler weather on tap for much of the country
* Coming up: EIA oil data Wednesday, EIA gas data Thursday
(Adds cash prices, updates futures prices)
By Eileen Houlihan
NEW YORK, Oct 3 (Reuters) - U.S. natural gas futures slid more than 3 percent early Wednesday amid profit-taking after gaining more than 24 percent over six straight winning sessions.
On Tuesday the front-month contract rose to its highest mark this year amid forecasts for cooler weather in the coming days and strong nuclear power plant outages.
But many traders remained concerned that gas priced at well above $3 per million British thermal units would continue to lose market share to coal for power generation.
Still, producers that shut in wells when prices fell easily below $3 could again be tempted to hook up wells that had been drilled but not flowing.
As of 9:36 a.m. EDT (1336 GMT), front-month November natural gas futures on the New York Mercantile Exchange
were at $3.42 per mmBtu, down 11.1 cents, or more than 3 percent. The contract rose as high as $3.546 on Tuesday, its best mark since last December.
In the cash market, gas bound for the NYMEX delivery point Henry Hub
in Louisiana was heard early flat to Tuesday's average at $3.21 on volume near 696 million cubic feet.
Early deals were done at a 19-cent discount to the front-month contract, firming from deals done late Tuesday at a 30-cent discount.
Gas on the Transco pipeline at the New York citygate
was heard up 3 cents at $3.41 on volume near 273 mmcf.
The National Weather Service's six-to-10-day outlook issued on Tuesday again called for temperatures below normal or much below normal for nearly the entire United States, with normal or above-normal readings only in the West and south Texas.
On the nuclear front, outages on Wednesday totaled 15,900 megawatts, or 16 percent of U.S. capacity, up from 15,200 MW out on Tuesday, 13,800 MW out a year ago and a five-year outage rate of about 15,300 MW.
While the U.S. National Hurricane Center said a tropical depression was likely to form west of the Cape Verde Islands on Wednesday, forecast tracks for the system show it veering northeast in the Atlantic, far away from land.
STORAGE BUILDS PICK UP, STOCKS AT RECORD HIGHS
Last week's gas storage report from the U.S. Energy Information Administration showed domestic gas inventories had risen in the previous week by 80 billion cubic feet to 3.576 trillion cubic feet. It was the biggest weekly injection so far this year.
Record heat this summer helped trim a huge storage surplus relative to last year from its late March high near 900 bcf, but traders expected builds to continue to pick up as weather loads fade.
Domestic gas inventories are still at record peaks for this time of year and likely to end the stock-building season above last year's all-time high of 3.852 trillion cubic feet.
At 82 percent full, stocks hovered at levels not normally reached until the second week of October and still offered a huge cushion that can help offset any weather-related spikes in demand or supply disruptions from storms.
Early injection estimates for this week's EIA report range from 55 bcf to 75 bcf, compared with a year-earlier build of 101 bcf and the five-year average increase for the week of 78 bcf.
RIGS DECLINE, PRODUCTION STILL HIGH
Drilling for natural gas has been in a nearly steady decline for the last 11 months, sliding by 19 rigs last week to a 13-year low of 435, Baker Hughes data showed.
But while pure gas drilling has become largely uneconomical at current prices, gas produced from more-profitable shale oil and shale gas liquids wells has kept output stubbornly high.
EIA gross natural gas production data on Friday showed July output had climbed 0.4 percent from June to 72.58 bcf per day, not far below January's record high of 72.74 bcfd.
(Editing by Jeffrey Benkoe and Lisa Von Ahn)
Keywords: MARKETS NYMEX/NATGAS