NGI Staff Reports

Last year was boom time for El Paso Energy, which saw earnings jump 15% in the wake of its merger with Tenneco Energy. The year was not as kind, though, to Duke Energy, which was still digesting the mega-combination of Duke Power and PanEnergy that created the company.

Despite lower throughput on most of its pipes, Williams reported record operating profit from its pipeline business, and Energy Services got a huge boost to record levels from a $27.5 million increase in profit from Exploration and Production. E&ampP’s whopping gain in profit to $30.3 million from $2.8 million came mainly from an increase in gas prices and production, the company said.

As most market analysts predicted, reports from major producers are showing U.S. gas production down in 1997. The domestic natural gas production of Texaco, Chevron, Exxon and Amoco in 1997 collectively was down by 2.5% (202 MMcf/d) to about 8,014 MMcf/d, according to year-end earnings reports released by the four majors last week.

A small expansion project on El Paso Natural Gas’ San Juan Basin pipeline system is taking heavy fire from protesters at FERC because it gives special privileges to three shippers. The project is El Paso’s proposed $3.6 million, 116.5 MMcf/d expansion of its Bondad line from Ignacio, CO, to Blanco, NM, which is designed to increase capacity on the most constrained area of El Paso’s pipeline system. The pipeline company plans to install new compression on an existing pipeline to serve Enron Capital &Trade, Elm Ridge Resources, and Conoco.

A Department of Justice (DOJ) official called on FERC last week to consider placing a temporary moratorium on “potentially problematic” utility mergers during the transition to a restructured electricity industry.

Capping off months of often contentious settlement talks at FERC, the Gas Research Institute (GRI) and the majority of natural gas industry negotiators last week reached a final agreement that provides for funding of the institute and its programs while it begins its seven-year transition to a voluntary-funded gas research organization.

The Scandinavian connection is emerging in U.S. energy markets with offshoots of a Norwegian-based, privately held Scandinavian Power Brokers setting up shop in the areas most likely to have retail electric competition in the near future. It has opened Boston and San Francisco offices and is looking for a location in Texas, according to its founder and CEO.

ONSI Corp. recently announced it sold two PC25 fuel cells to The Durst Organization to provide 400 kW of electricity, primarily for external lighting for the landmark sign on the top of 4 Times Square in New York City.

Pine Needle LNG said it will have firm service for liquefied natural gas storage starting in the 1999/2000 winter heating season. Construction of two storage tanks, each with 2 Bcf of capacity, is well under way at the Pine Needle facility in Guilford County, NC. The site is near Transco’s Compressor Station 160. Pine Needle reported 361,010 Mcf of storage volume available for subscription, with current vaporization capacity of 36,101 Mcf/d and liquefaction capacity of 1,805 Mcf/d. Upon completion of the two tanks, the respective vaporization/liquefaction figures will be 400 MMcf/d and 20 MMcf/d. Pine Needle is owned by units of Transco, Piedmont Natural Gas, Public Service Co. of North Carolina, North Carolina Natural Gas, Municipal Gas Authority of Georgia and Amerada Hess.