(Updates prices)

Feb 24 (Reuters) - U.S. natural gas futures gained close to 6% ahead of the expiry of the front-month March contract on Friday on forecasts for colder weather and higher heating demand over the next two weeks than previously expected.

On its last day as front-month, gas futures for March delivery on the New York Mercantile Exchange (NYMEX) rose 13.7 cents, or 5.9%, to settle at $2.451 per million British thermal units (mmBtu).

The contract has risen 7.7% so far this week, after briefly

dropping below $2 per mmBtu

on Wednesday.

"We are seeing support in US gas markets this week from a combination of shifts cooler on weather outlooks, confirmation of 2 $(LNG)$ trains at Freeport restarting and some early announcements that drillers are cutting back on plans for 2023," Gary Cunningham, director of Market Research at Tradition Energy, said in an email.

Data provider Refinitiv estimated 355 heating degree days (HDDs) over the next two weeks, up from 347 HDDs estimated on Thursday. The normal for this time of year is 342 HDDs.

HDDs estimate demand to heat homes and businesses by measuring the number of degrees a day's average temperature is below 65 degrees Fahrenheit (18 degrees Celsius).

With cold weather coming, Refinitiv forecast U.S. gas demand, including exports, would rise from 119.0 billion cubic feet per day this week to 121.4 bcfd next week.

Refinitiv said average gas output in the U.S. lower 48 states fell from 98.1 bcfd in January to 97.4 bcfd so far in February, due to a cold spell earlier in February which froze oil and gas wells. That compared with a monthly record of 99.8 bcfd in November 2022.

On Wednesday, Chesapeake Energy Corp said it would drop three drilling rigs in coming months and would reduce gas output by 4% to 6% this year. The move followed Comstock Resources Inc's , which earlier disclosed it would take down two rigs in coming months due to weaker prices.

"With the upcoming arrival of March and the roll to the April futures as the prompt contract, the weather factor will be diminishing in importance in forcing the market to rely heavily on a supply-side response to current low pricing," analysts at energy consulting firm Ritterbusch and Associates said in a note.

The U.S. Energy Information Administration $(EIA)$ said utilities pulled 71 billion cubic feet (bcf) of gas from storage during the week ended Feb. 17. That was more than the 67-bcf decrease analysts forecast in a Reuters poll.

On Tuesday, Freeport LNG got approval from federal regulators to partially restart commercial operations at its Texas plant after an outage caused by a fiery blast last June that lasted more than eight months.

The second-biggest U.S. LNG export plant was on track to pull in about 0.75 bcfd of gas from pipelines for the third day in a row on Friday, according to Refinitiv. Freeport LNG, when operating at full power, can turn about 2.1 bcfd of gas into liquefied natural gas for export.

However, energy regulators and analysts, have said they do not expect Freeport LNG to return to full commercial operation until mid-March or later.

Week ended Week ended Year ago Five-year

Feb 17 Feb 10 Feb 17 average

(Actual) (Actual) Feb 17

U.S. weekly natgas -71 -100 -138 -177

storage change (bcf):

U.S. total natgas in 2,195 2,266 1,800 1,906

storage (bcf):

U.S. total storage 15.2% 8.8%

versus 5-year average

Global Gas Benchmark Current Day Prior Day This Month Prior Year Five Year

Futures ($ per mmBtu) Last Year Average Average

2022 (2018-2022)

Henry Hub 2.36 2.17 4.46 6.54 3.60

Title Transfer Facility 16.95 16.20 26.94 40.50 14.39

$(TTF)$

Japan Korea Marker (JKM) 14.9 14.84 25.82 34.11 14.31

Refinitiv Heating $(HDD.UK)$,

Cooling $(CDD.AU)$ and Total

(TDD) Degree Days

Two-Week Total Forecast Current Day Prior Day Prior Year 10-Year 30-Year

Norm Norm

U.S. GFS HDDs 355 347 357 339 342

U.S. GFS CDDs 14 15 12 10 8

U.S. GFS TDDs 369 362 369 349 350

Refinitiv U.S. Weekly

GFS Supply and Demand

Forecasts

Prior Week Current Next Week This Week Five-Year

Week Last Year Average For

Month

U.S. Supply (bcfd)

U.S. Lower 48 Dry 98.1 98.1 98.6 87.7

Production

U.S. Imports from Canada 7.8 8.1 8.2 9.1

U.S. LNG Imports 0.0 0.0 0.0 0.2

Total U.S. Supply 105.9 106.2 106.8 97

U.S. Demand (bcfd)

U.S. Exports to Canada 2.7 2.6 2.6 2.7

U.S. Exports to Mexico 5.2 5.2 5.1 5.2

U.S. LNG Exports 13.0 11.2 11.4 6.6

U.S. Commercial 14.1 14.1 15.2 16.4

U.S. Residential 22.7 23.2 25 27.7

U.S. Power Plant 30.1 30.5 29.9 28.1

U.S. Industrial 24.1 23.8 24.5 25.2

U.S. Plant Fuel 4.8 4.8 4.9 4.8

U.S. Pipe Distribution 2.6 2.6 2.7 3.1

U.S. Vehicle Fuel 0.1 0.1 0.1 0.1

Total U.S. Consumption 98.6 99.3 102.3 105.4

Total U.S. Demand 119.5 119.0 121.4 119.9

U.S. weekly power

generation percent by

fuel - EIA

Week ended Week ended Week ended Week ended Week ended

Feb 24 Feb 17 Feb 10 Feb 3 Jan 27

Wind 16 15 15 10 11

Solar 3 3 3 2 2

Hydro 7 7 6 7 7

Other 2 2 2 2 2

Petroleum 0 0 0 0 0

Natural Gas 37 37 36 39 38

Coal 14 15 17 21 19

Nuclear 21 21 21 19 21

SNL U.S. Natural Gas

Next-Day Prices ($ per

mmBtu)

Hub Current Day Prior Day

Henry Hub 2.16 2.07

Transco Z6 New York 2.38 2.00

PG&E Citygate 15.51 8.25

Eastern Gas (old 2.04 1.79

Dominion South)

Chicago Citygate 2.27 2.18

Algonquin Citygate 14.00 4.52

SoCal Citygate 13.81 8.19

Waha Hub 1.78 1.30

AECO 2.82 2.71

SNL U.S. Power Next-Day

Prices ($ per

megawatt-hour)

Hub Current Day Prior Day

New England 119.00 42.25

PJM West 32.25 26.50

Ercot North 23.00 18.00

Mid C 251.67 187.50

Palo Verde 127.75 91.00

SP-5 140.25 94.75

(Reporting by Rahul Paswan and Brijesh Patel in Bengaluru; editing by Jonathan Oatis and Diane Craft)

((RahulKumar.Paswan@thomsonreuters.com; If within U.S. +1 646 223 8780))

((For Refinitiv type ENERGY in Eikon search bar and then go to the GAS drop down and the NORTH AMERICA drop down or see: cpurl://apps.cp./cms/?pageid=usa-gas For Interactive Map, type 'Interactive Map' in the box at upper left of the Reuters nEiko terminal. For graphics on Baker Hughes rig counts, see: For next-day SNL U.S. gas prices, see: For next-day SNL U.S. power prices, see: For U.S. natgas price and storage polls, see: For U.S. nuclear power outages, see: For U.S. Northwest hydro power report, see: For U.S./Canada natural gas rig count vs Henry Hub futures price, see: For the U.S. natural gas speed guide, see: For the U.S. power speed guide, see: To determine CFTC managed money net position add (NYMEX Henry Hub options and futures combined ) plus (ICE Henry Hub options and futures combined divided by four) plus (NYMEX Henry Hub swaps options and futures combined divided by four) plus (NYMEX Henry Hub penultimate gas swaps divided by four) NYMEX Henry Hub options and futures combined NYMEX Henry Hub futures only ICE Henry Hub options and futures combined NYMEX Henry Hub swaps options and futures combined NYMEX Henry Hub Penultimate gas swaps ))