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Six of Top 10 Gas Marketers Make Top 10 in Power

Six of Top 10 Gas Marketers Make Top 10 in Power

Yet another example of gas-power convergence shows up in NGI's ranking of the top gas and power marketers based on third quarter volumes. Three of the top five marketers of each commodity and six of the top 10 appear on both lists.

But perhaps the biggest surprise is that some of the largest power marketers have recently migrated over into the top gas ranks. Tractebel Energy Marketing's gas volumes soared more than 10,000% by the end of the third quarter from 3Q97. Its power volumes grew more than 1,400%.

The subsidiary of Belgium's largest electric utility has quietly become one of the largest players in the U.S. energy market. And it has accomplished that feat in a somewhat nontraditional way. Most of the big marketing gainers over the past couple years made their gains by buying up other companies or forming alliances. PG&ampE Energy, for example, jumped into the top 10 in the gas and power rankings when it purchased Valero Energy's gas unit and Teco Pipeline. Southern Company moved into the gas rankings by teaming up with Vastar. But marketing community insiders say Tractebel has accomplished the same thing by quietly hiring off top traders and marketers from other major companies. During the third quarter Tractebel sold 3.74 Bcf/d of gas and 19.62 million MWh of power, compared to 0.03 Bcf/d of gas and 1.28 million MWh of power in 3Q97. One source inside the company stated, "You see that kind of growth when a company has an aggressive growth plan like we do and you're starting from scratch."

The Houston-based company, which focuses on selling energy either to intermediaries and utilities, or to the end user, now has a staff of 60, about 45 of which trade power, gas and liquefied fuel. Tractebel's global energy and services business is active in more than 100 countries providing services in fields that range from electricity and gas to engineering, communications, technical installations and waste management. It has been a prominent player in the U.S. power generation market this year. Tractebel formed a joint venture in January with Juno Beach, FL-based FPL Group to purchase two existing 300-MW gas-fired, combined-cycle power plants in the Northeast. And it formed a joint venture with Sprague Energy in February to build a new gas-fired, independent power project in Newington, NH. But its gains in marketing have gone relatively unnoticed.

Probably not surprising to anyone, however, is that Enron still sits atop the list of both power and gas marketers. Also not too surprising, Dynegy and Aquila Energy are the other two companies making the top five in both categories. In addition to these three, Duke Energy, Southern Company Energy Marketing, and PG&ampE Energy made the top 10 in both categories.

Most of the top gas marketers saw modest to significant growth in volumes from the third quarter of 1997. Others that grew gas volumes substantially were Aquila Energy, 35%; Coral Energy, 27%; Houston Industries Wholesale Energy, 24%; and Enron, 22%. Two companies saw volumes decline. Sonat Marketing dropped 16%, and El Paso Energy dropped 15%. An El Paso spokeswoman attributed the company's decline, in part, to weather and said during the period El Paso was working to integrate LG&ampE Energy's trading books, which it had purchased.

El Paso fared better on the power side where the company ranked at No. 14 but gained 313% in volume from the third quarter of 1997. However, there were two companies that saw huge jumps in power volumes. Tractebel at No. 15 jumped 1,434%, and Statoil Energy at No. 9 jumped 1,157%. Elsewhere on the list, gains of more than 100% were the norm.

NGI queried companies for their wholesale gas and power volumes in North America only, excluding financial or non-physical volumes. Some power volume figures also came from quarterly filings with the Federal Energy Regulatory Commission.

Joe Fisher, Houston; Rocco Canonica

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