If you work in Alberta’s energy sector, particularly on the gas-weighted side, you’ve probably felt a bit like you’re watching a slow-motion car chase. You know where things are heading, but the journey there feels agonizingly gradual.
Here’s the current picture: the benchmark for Alberta natural gas (AECO) is forecast to average about $2.15 per mmBTU in 2026, climbing to roughly $3.20 in 2028. A balmy winter and a slower-than-expected LNG Canada ramp-up have kept prices subdued.
For context, AECO averaged just $1.65/GJ in June 2026, up 13.8% month-over-month and 23.1% year-over-year, but still well below where many hoped it would be. As one industry insider put it, “We’re probably a dollar off where we thought in January we’d be”.
So, what’s going on? And more importantly, what does this mean for gas-weighted producers and their finance teams?
The Supply Glut Problem
Let’s start with the obvious: there’s too much gas.
Canadian gas production hit a record high in 2024, averaging 18.35 billion cubic feet per day (bcfd). For the first quarter of 2025, production averaged 19.24 bcfd, which would result in another record year if the trend continues. Gas storage capacity in Western Canada is essentially full, at 635 billion cubic feet in inventories.
Producers ramped up output in expectation of LNG Canada coming online. But the facility’s ramp-up has been slower than anticipated. LNG Canada shipped its first cargo on June 30, but it’s been using under 400 million cubic feet per day, well below the first train’s design capacity due to a problem with one of the lines. Train 1’s production is expected to increase over the next three weeks, putting full output closer to the end of August. The second train isn’t expected to achieve full production until next year.
As Mike Belenkie, CEO of Calgary-based gas producer Advantage Energy, put it: “We’re instead all in a holding pattern”.
The Price Outlook: Near-Term Pain, Long-Term Gain
Here’s where it gets interesting, and where finance leaders need to pay attention.
In the near term, the forecast remains subdued. Alberta is likely to spend most of 2026 and 2027 in a roughly $3 to $4/GJ world. That’s not terrible, but it’s not the kind of pricing that fuels massive investment either.
But the medium-term outlook is more optimistic. As Woodfibre LNG and Cedar LNG come into service in 2028 and 2029, Alberta could move into a $4 to $5/GJ world. By 2030, if the global LNG market remains tight and late-decade projects continue to advance, we could be looking at roughly $4.50 to $6/GJ. The Alberta Energy Regulator’s base case forecasts AECO-C prices rising to Cdn$3.82/GJ in 2026 and slowly increasing to Cdn$4.37/GJ by 2034.
What does that mean for finance teams?
1. Cash flow management is critical. With prices subdued, producers need to be disciplined about capital allocation. As Chris Carlsen, CEO of Birchcliff Energy, noted, the extended downturn has weakened companies’ abilities to return capital to shareholders.
2. Scenario planning is non-negotiable. What happens if prices stay at $2.15 for the next two years? What if they hit $3.50 by 2027? What if the LNG Canada ramp-up accelerates—or slows further? Your finance team needs to model all of these.
3. Hedging strategies matter more than ever. In a volatile market, the difference between a good year and a great year often comes down to how well you’ve hedged your exposure.
4. Keep an eye on the data center demand. Pembina Pipeline and partners are developing a 932 MW natural gas-fired combined-cycle plant in Alberta to help meet rising data center demand. That’s a new source of demand that could help absorb some of the supply.
What This Means for Finance Leaders
If you’re a finance leader at a gas-weighted producer, the message is clear: stay disciplined, stay flexible, and stay informed.
The next few years aren’t going to be a straight line. There will be ups and downs. But the long-term direction is positive. LNG Canada is coming online (even if slower than expected). Woodfibre and Cedar are on the horizon. And data center demand is creating new outlets for Western Canada’s abundant gas supply.
The organizations that navigate this period successfully will be the ones with strong finance teams, teams that can manage cash flow, model scenarios, and help leadership make informed decisions in an uncertain environment.
About BullsEye Recruitment Inc.
BullsEye Recruitment Inc. is a Calgary-based boutique recruitment firm specializing in placing experienced accounting and finance professionals at senior levels. We understand the Alberta economy, the energy sector, and what it takes to find the right people the first time.
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