YANKTON, S.D.(WNAX)- As winter began there were fears that natural gas prices could spike to record levels due to cold weather and high demand in Europe. Instead those prices have dropped steadily.

Luke Hansen is Manager of Gas Supply for Northwestern Energy.

Hansen says after the cold wave in December, milder weather has dropped demand.

Hansen says they do reset their rates based on their gas costs.

Hansen says they are working this week on gas contracts for next fall and winter.

Northwestern serves about eighty thousand natural gas customers in eastern South Dakota and central Nebraska.