Inergy LP subsidiary Inergy Midstream LLC said it is buying the Seneca Lake natural gas storage facility in Schuyler County, NY, and two related pipelines from New York State Electric & Gas Corp. (NYSEG) for about $65 million. Seneca Lake is an approximately 2 Bcf salt cavern facility on Inergy's US Salt property outside Watkins Glen, NY, and has a maximum withdrawal capability of 145 MMcf/d and maximum injection capability of 75 MMcf/d. Seneca Lake at close of the acquisition is expected to be contracted with a weighted average maturity of its firm storage capacity extending to 2015. Inergy said it anticipates closing the transaction by mid-2010.

Forest Oil Corp.'s third operated horizontal well in the emerging Granite Wash play of West Texas produced at a 24-hour production rate of 15.1 MMcf/d, and the fourth well produced at an initial rate of 16 MMcf/d, the Denver-based producer said. The third well, in addition to its gas rate, also over 24 hours in December, produced 1,200 b/d of oil and condensate and 2,400 b/d of natural gas liquids (NGL) for an equivalent rate of 37 MMcfe/d. The fourth well's results, reported from earlier this month, also produced at an equivalent rate of 37 MMcfe/d, which included 1,300 b/d of oil and condensate and 2,200 b/d of NGL. The wells were completed with horizontal legs of about 4,200 feet and nine-10 hydraulic fracture stimulation stages at an average total well cost of $6.8 million.

Chevron Corp. increased its natural gas and oil output by 9%-plus in October and November compared with the full final quarter of 2008, the oil major said. The interim production volumes, realizations and margins reported are based on October and November 2009 results, compared with performance in the final three months of 2008. U.S. net natural gas production jumped in October and November to 1.399 Bcf/d, versus 1.32 Bcf/d in 4Q2008. Domestic liquids output rose to 526,000 b/d from 399,000 b/d. Total U.S. upstream output was up at 759,000 boe/d from 619,000 boe/d in 4Q2008.

Natural gas bills for San Francisco-based Pacific Gas and Electric Co. (PG&E) customers are projected to drop an average of 9.2% in January, compared with January 2009, the result of warmer weather and lower fuel costs. However, on the electric side PG&E customers on average are facing a 2.9% rate increase that was effective Jan. 1. The average January power bill will be about $77, according to the utility, and adding in the monthly natural gas charges results in an average combined bill this month for residential customers of about $165. In the traditional peak month for natural gas bills, January charges will average about $88 for residential gas customers, compared with charges last January of about $97 on average.

Gill Ranch Storage LLC, a joint venture of two western utilities, has launched construction of its gas storage facility at a site near Fresno, CA, in the northern end of the state's central valley. The sponsors are targeting August for completion in time for the seasonal storage buildup ahead of next winter. The California Public Utilities Commission approved Gill Ranch as a 20 Bcf capacity project to be headed by a unit of Portland, OR-based Northwest Natural Gas and San Francisco-based Pacific Gas and Electric Co. (PG&E) (see NGI, Oct. 19, 2009). The project also involves a new 25-mile, 30-inch diameter gas pipeline to connect with PG&E's existing transmission backbone pipeline (No. 401) north of Panoche, CA.

Gateway Energy Corp. has acquired the Hickory Creek Gathering System from Hickory Creek Gathering LP and Range Texas Production LLC for $3.9 million in cash, adjusted to reflect a transaction effective date of Nov. 1, 2009. The system is in Denton County, TX, in the core of the Barnett Shale and currently services two significant producers, Gateway said. There are 15 producing wells connected to the system with throughput of approximately 11,000 MMBtu/d at a fixed gathering fee. Based on projected 2010 production, Gateway expects the system to increase its revenue in 2010 by approximately $772,000, assuming no additional wells are placed on the system during 2010.

A 68-year-old man arrested in Alberta on suspicion of involvement with bombings of EnCana Corp. natural gas facilities in the Dawson Creek area of British Columbia (BC) during 2008 and 2009 was released Jan. 9, the Royal Canadian Mounted Police (RCMP) said. No charges were laid against the man, whom press reports identified as longtime anti-oil and gas development activist Wiebo Ludwig (see NGI, Jan. 11). RCMP said evidence collected in the investigation of the man's property near Hythe, AB, would be submitted to Crown Counsel for consideration. Charges could still be filed, RCMP said last week.

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