NGI The Weekly Gas Market Report / NGI All News Access

In Brief

In Brief

The Interior Department's Minerals Management Service has scheduled a meeting in Houston to discuss implementation of its Gulf of Mexico Royalty In-Kind pilot program, which is slated to begin in October. The three-year program will involve the collection and sale of as much as 800 MMcf/d of royalty gas from federal leases in the Gulf. It is the MMS's third RIK pilot, all of which are being conducted to determine the feasibility and economics of accepting royalties in kind rather that as a cash payment from lessees. The meeting on the Gulf RIK will begin at 10 a.m. on July 20 at the MMS Houston Compliance Division Office RM 104, 4141 Sam Houston Parkway East. It is open to the public without reservation. Lessees, operators, payers and potential purchasers are encouraged to attend.

Meridian Resource Corp. said it has extinguished the large fire at its Thibodaux No. 2 well near Amelia, LA. The well "bridged over," blocking substantially all the flow of natural gas, the company said. The underground geologic formation collapsed into the well bore as a result of the high pressure and flow rate of escaping gas, which created a natural "bridge" that temporarily is blocking the gas flow. A small fire continues to burn debris and residual natural gas near the well but will be allowed to safely burn itself out. The height of the flames has been reduced to less than 12 feet from about 150 feet. Meridian CEO Joseph A. Reeves Jr. said, "This is great news in that our well control specialists and firefighters on the scene can accelerate access to the well site by closer dredging and debris removal under safer conditions with much less heat and noise. Dredging operations may last another three or four days," he said last Thursday. "Once debris removal and well inspection is complete, our team can determine the best and safest method for capping the well." The well fire was caused by a lightning strike June 23. No one was injured, but 11 families were evacuated from Avoca Island June 25 as a safety precaution. Meridian said the well was scheduled to be placed in production in July with 18 MMcf/d of gas.

Dynegy has fired up its first constructed, owned and operated natural gas-fired peaking plant, the 250 MW Rocky Road Power Plant near Chicago, in time to serve the summer air conditioning load. Dynegy plans to sell the power generated at the merchant power plant into the wholesale electricity market. As a peaking plant it will run on an as-needed basis. The Rocky Road plant is part of the company's previously announced plan to back up its trading unit with a $5 billion generation expansion program. Dynegy is aiming to own or control more than 70,000 MW of generating capacity by 2003. It has 6,800 gross MW operating or under construction and recently announced plans for two natural gas-fired 500 MW plants, one in Heard County, GA and another in Oldham County, KY.

Shareholders of New Century Energies and Northern States Power Co. approved the merger of the two companies last week. The new company will be named Xcel Energy Inc. At separate special shareholder meetings in Denver and Minneapolis, more than 83% of the voting shares of both NCE and NSP voted in favor of the merger. The merger, announced on March 25, still requires state and federal regulatory approval, which is expected to be completed in nine to 15 months. Under terms of the merger agreement, holders of NCE stock will receive 1.55 shares of stock in Xcel Energy for each of their NCE shares. Each share of NSP stock will become one share of Xcel Energy.

©Copyright 1999 Intelligence Press, Inc. All rights reserved. The preceding news report may not be republished or redistributed in whole or in part without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1266
Comments powered by Disqus