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Weekend Prices Maintain Bullish Trend

Weekend Prices Maintain Bullish Trend

The drop in gas load that usually accompanies a weekend reduction of business activity failed to dampen the cash market's bullishness Friday. Though a few points (El Paso-Permian and Trunkline-South Texas) eked out only penny upticks and CIG and Waha were essentially flat, most markets achieved gains of 3-7 cents. Influencing factors were unchanged from earlier in the week, sources said: Western cold, Southern heat, a higher screen and electric utilities using gas in peaking units while many nuclear and coal plants are down for refueling or other maintenance.

The casualty toll in the Thursday explosion of TECO Energy's 1,270-megawatt coal-fired power plant near Tampa, FL (see Daily GPI, April 9) rose to two deaths and 50 injuries in later reports Friday. A prognosis for returning the plant to service was unavailable from TECO by press deadline Friday. However, a spokesman for Florida Power & Light said all of the state's electric utilities besides TECO had adequate power reserves.

Electric generation load for gas remained strong in Florida, however, and in the rest of the South also. A big aggregator trading at 10 Louisiana points saw all of them averaging $2.01 or more, topped off by a $2.08-12 range into Florida Gas Transmission-Zone 2. The $1.98 low ends of its Louisiana ranges occurred on ANR and Tennessee's 800 Leg.

Midcontinent numbers were strong in the $2 area, a marketer said. Chicago citygates started with a $2.08 bid "before the bell rang" and went straight up with the screen as soon as trading opened, he said. The marketer thinks end-users must be expecting higher prices later because normally they would be withdrawing the cheap gas they have in storage, but instead are continuing to buy in the spot market.

Cash has moved up almost every morning over the last two weeks as a sort of affirmation of the run-ups that have been prevalent in the prior evening's Access futures trading, a Houston marketer said. He also pointed out that the last two Aprils have had generally moderate temperatures in the South; "this time it's much hotter."

To a Western trader, it looked like everything "was going to shoot up real high this [Friday] morning, but then things settled down to small gains." The West was expected to remain on the cool side over the weekend but to begin warming early this week.

Nymex's early-morning strength was the main reason for increases to the US$1.90 area at Sumas and to the low C$2.50s for both intra-Alberta and Westcoast Station 2, according to a Calgary source.

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