Industry Briefs

Xcel Energy Inc. has filed a proposal with the Colorado Public Utilities Commission to reduce the natural gas component of its Colorado retail rates by $571 million a year. If approved, the gas cost adjustment would reduce the delivered price of gas by more than 40% beginning in October. Under the plan, Xcel would reduce the cost of gas to $2.79/Mcf from the $6.91/Mcf that customers paid last winter during the escalating price swings. The costs are in addition to fixed delivery rates, which include metering, billing and distribution costs, and they vary depending on the customer.

Natural gas rates in the Carolinas are headed down again, according to Piedmont Natural Gas Co.. As a result, Piedmont said it has filed for a gas service rate decrease that should make its customers in the Carolinas see their gas bills decline by 15-20% this winter compared to last winter, assuming normal weather. For the fifth time in North Carolina and the third time in South Carolina since last winter, Piedmont said it filed for a decrease in its rates for natural gas service, which will become effective Oct. 1. The decrease reflects the "continuing and substantial decline" in the wholesale cost of gas since last winter nationwide. If approved by each state's utilities commission, Piedmont's October rates will be lower than they were last October. The company attributed the decrease to increasing supply, milder weather and reduced demand, which have had a positive effect on wholesale gas costs. Assuming normal weather, Piedmont said customer's bills in December and January should be substantially lower than for the same months last winter, and even lower than the 15-20% reduction forecast for the entire winter period. December weather in the Carolinas last year was 37% colder than normal, which combined with high wholesale gas prices, produced customer bills as much as double those of the previous year. The company added that its gas storage levels are in line with levels nationwide, which are "healthy levels." For the week ending Sept. 7, the American Gas Association reported storage 81% "full" as compared to 69% the year earlier. Piedmont said approximately 33% of its winter gas needs are met with gas that it stores over the summer period. Piedmont Natural Gas is an energy and services company that is involved in the transportation, distribution and sale of natural gas to over 700,000 residential, commercial and industrial customers in North Carolina, South Carolina and Tennessee.

San Antonio-based Abraxas Petroleum Corp. has extended its share exchange offer for Grey Wolf Exploration Inc. until Sept. 28. A total of 5.9 million shares of Grey Wolf, representing 88% of what Abraxas and its Canadian Abraxas did not own, have now been tendered and taken up, giving Abraxas 94% of the common outstanding shares of Grey Wolf. The Grey Wolf shares may be tendered by holders whose certificates are not immediately available by completing a validated Notice of Guaranteed Delivery with the exchange offer materials or a facsimile. Each Grey Wolf share will be exchanged for 0.6 of a share of Abraxas common stock. The exchange began in late July, at which time Abraxas and Canadian Abraxas held about 48.3% of Grey Wolf's outstanding common stock. Independent Abraxas is a crude oil and natural gas exploitation and production company that also processes natural gas. It operates in Texas, Wyoming and Western Canada. Grey Wolf, a junior crude and natural gas company, focuses its efforts on exploring for, developing, acquiring and producing crude oil and natural gas in western Canada and the Northwest Territories. Natural gas in central and northern Alberta accounts for more than 90% of Grey Wolf's reserves and production.

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