* Gas demand down 20 percent below average levels * Traders dismiss impact of Norwegian field outage (Reuters) - British prompt gas prices fell on Friday morning due to mild weather and low demand but forward contracts moved higher in response to strong crude oil prices. Gas for Monday delivery traded 0.30 pence higher at 58.60 pence per therm ahead of colder temperatures, but within-day gas dropped by 1 pence to 57.50 pence as mild weather and ample supply kept the transmission network running smoothly. The UK gas market was 20 million cubic meters oversupplied as temperatures approached a daily forecast maximum of 13 degrees Celsius, reducing demand for gas-fired home heating. "Exports to Europe are expected to stay fairly strong over the weekend, at about 10 million cubic meters a day," a trader said. Gas exports from Shell's giant Ormen Lange gas field off Norway, which can provide some 20 percent of UK gas demand, will be curtailed in May due to maintenance, limiting one of Europe's key gas supplies. However, traders dismissed the news as having already been priced into the market. Further forward, the benchmark summer 2012 gas contract edged 0.25 pence lower at 58.10 pence, whereas the rest of the forward curve posted gains of up to half a penny. The UK Met Office expects widespread overnight frosts, though there are indications of less cold conditions in its 6-15 day forecast. POWER In the power market, day-ahead baseload was trading at 43.60 pounds per megawatt hour. (Reporting by Oleg Vukmanovic; Editing by Alison Birrane)

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