It was like old times again (if you can regard February as “oldtimes”) for traders Friday as weekend swing pricing leveled offwith little change from Thursday. It reminded some of the longperiods last month when there was practically no volatility in thecash market. The small gains handily outweighed a few scatteredpenny drops in the West for an overall showing of flat to a smidgenhigher.

A gap of nearly C20 cents has opened between Westcoast Station 2and intra-Alberta, which usually track each other much moreclosely, one source said. Station 2 was in the high C$1.90s whileintra-Alberta traded in the mid C$2.10s, she said. A constraint isin place at Gordondale, the provincial border point where the NOVAand Westcoast systems connect, and whatever British Columbia gascan get through is flowing into Alberta because of the strongermarket there, she added.

Predictably, late-March activity was dropping off as peopleturned more of their attention to the April bidweek. April tradingpicked up some Friday but was still rather slow, a marketer said.

A Texas producer noted, “We’re selling Agua Dulce gas at Ship[Houston Ship Channel index] minus 5.” His company is starting tosee the effects of slowed-down drilling in 1998, he said, becausecurrent production levels are down considerably. He thought thatwas also true of many other producers. It was encouraging thatcrude oil futures closed above $16/bbl Friday for the May, June andJuly contracts, the producer said; “that helps make us more bullishon gas.”

A marketer found very tight March-April convergence in the SanJuan Basin. He was buying Blanco pool gas for April at $1.57-59,which dovetailed nicely with his March swing deals at $1.57-58.

One source reported Michigan citygate basis at plus 8.5, sayingit had gotten stronger since earlier in the week. Michigantemperatures were around 50 degrees Friday, “which is a veritableheat wave for that state in March,” he said.

A marketer hearing $1.52-53 numbers for Sumas in April saidsummer term (April-October) deals were a bit higher at $1.54-57.The intra-Alberta differential was even bigger, she said, quotingApril-only at C$2.23-24 and summer at C$2.33-35.

“I don’t care whether the direction is up or down, I just wantto see a sizeable change Monday in the April futures contract priorto expiration,” a Northeast-oriented marketer said. “We need morevolatility, but I’m afraid it probably won’t happen.”

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