PowerSpring Inc. is preparing to muscle its way into the virtualmarketplace next month, offering commercial and industrial energyusers an online shopping area to take better advantage ofderegulation. Officials last week touted the launch of its newInternet site, www.powerspring.com, promising energy users the “bigplayer” benefits of deregulation – market clout and savings.Through its website, PowerSpring plans to manage energy use for itscustomers by using aggregated customer demand, an online auctionand customized reports. Sidney Hinton was named president and CEOof PowerSpring at the launch last week, which coincided with parentcompany Metretek’s annual shareholder meeting in Denver. The newcompany was first announced last month (see NGI, April 17).”PowerSpring has the potential to revolutionize the purchase andmanagement of energy among an ever-growing universe of commercialenergy users,” Hinton said. PowerSpring’s virtual energymarketplace, designed by e-business partner Scient, will offer asingle source for purchasing and managing energy, with customersreceiving one consolidated bill. Initially, the service will onlybe available to commercial and industrial natural gas users,however, as deregulation grows, PowerSpring plans to expand thecoverage area.

BC Gas selected Marine Pipeline Construction, a division ofMurphy Pipeline Inc., as its contractor for the 188-mile, 24-inchdiameter Southern Crossing gas pipeline. The contractor will beginmoving equipment immediately to locations along the pipeline route,which stretches from Oliver to Yahk, BC. Construction is expectedto begin before June 1 and be completed by November. The C$377million project will be designed to initially transport 250 MMcf/dwith room for expansion to 600 MMcf/d. Addition details areavailable in a pdf file on BC Gas’ web site.

Catalytica Combustion Systems Inc., Kawasaki Motors Corp. andEnron Energy Services Inc. plan to build three Kawasaki M1A-13X gasturbines for a distributed generation power project for thenortheastern United States. The engines will be equipped withCatalytica’s Xonon Cool Combustion technology, a system thatenables gas turbines to achieve extremely low emissions withoutexhaust gas cleanup systems. This is the first time Grand Rapids,MI-based Kawasaki Motors USA has ventured into the commercialmarket with its gas turbine system. Enron Energy Services Tom Whitesaid that the Xonon system is a “key element” in his company’sdistributed generation solution to supply clean energy forincreasing demands around the country.

Tucson Electric Power Co. and Citizens Utilities agreed topartner on a new power transmission line that will enhanceelectrical service reliability to southern Arizona and strengthenthe electric power grid in the southwestern United States. The twoutilities signed a deal to jointly develop the interconnection andtransmission project that will extend from southern Arizona to theMexico border. Citizens currently is engaged in several serviceimprovement initiatives in order to comply with an order from theArizona Corporation Commission (ACC) to improve reliability inSanta Cruz County. One component of Citizens’ plan is constructionof a new 115,000-volt transmission line by Dec. 31, 2003. TEPrecently participated with the Comision Federal de Electricidad(CFE), Mexico’s federal energy agency, in a joint feasibility studyto develop an interconnection with Mexico. The study concluded thata 345,000-volt interconnection from TEP’s substation nearSahuarita, AZ, to CFE’s system in Sonora, Mexico, is feasible.

Ameren Corp. subsidiary Ameren Energy Communications bought allof the assets of Energy Measurement Enterprises (EME), a providerof utility metering services based in Lodi, CA. Terms of thetransaction were not disclosed. Based in northern California, EMEwas formed in 1997 by Wayne Parker and John Lichti, former PacificGas & Electric employees. EME provides physical metering sales,services and maintenance in the direct access and IndependentSystem Operator (ISO) markets. The EME acquisition is Ameren’ssecond acquisition of a metering operation in the past 12 months.

Cross Timbers Oil Co.’s recent record of growth and debtconsolidation has convinced more than a few investors that it’s agood place to put money. The Fort Worth-based independent this weekcompleted financing of a new $850 million revolving credit facilitywith a group of 23 major U.S. and international banks., withproceeds from the loan used to retire its existing bank debt. Thecompany also completed buying back 3.4 million shares of stock at$11.55 per share and authorized the repurchase of up to 3 millionmore shares, or about 6.5% of shares outstanding.

Pacific Gas and Electric said the unusual event declared Mondayat its Diablo Canyon Power Plant Unit 1 was terminated at 9:57 a.m.Tuesday morning. It noted that “An Unusual Event” is the lowestlevel of emergency classification as defined by the NRC and doesnot require any emergency action by the general public or anygovernment agency. Throughout the event all reactor safety systemsfunctioned properly and radiation monitors did not detect anyradioactivity above normal background, the utility said. The eventwas terminated after off-site power was restored to the unit anddiesel generators used to power cooling equipment during the eventwere shut off and placed in standby. Offsite power was lostfollowing an electrical short and fire at 12:25 a.m. Monday. Thediesel generators are used to power reactor cooling equipment inthe event of a reactor trip when offsite power is not available.Efforts at the plant are now focused on determining the cause ofthe electrical short and fire and to make repairs.

Conoco said continued strong crude oil prices, along with risingnatural gas prices and a “rebound” in its downstream business couldresult in strong second quarter earnings along the same lines asthe company’s first quarter results, which were the best in thecompany’s 125-year history. CEO Archie W. Dunham said at thecompany’s annual meeting that strong commodity prices should helpoffset the seasonal decline in European natural gas demand. Hedescribed Conoco’s oil and gas production growth outlook as thebest in the industry, with a 4-5% average annual growth rate.Conoco will continue to maintain “strict cost and capitaldiscipline” while generating a 22% production increase between 1998and 2001. Conoco’s operating costs were cut by 20 cents a barrel in1999 “Last year, 50% of our wildcat exploratory wells werepotentially commercial, improving on a 30% success rate theprevious year,” he said. “This year, we plan to drill 25-30 wildcatwells in the Gulf of Mexico, Vietnam, Nigeria and other locations.”

The National Energy Marketers Association (NEM) lauded effortsby the New York legislature to reduce energy taxation in the stateby $1.2 billion. If Gov. George Pataki signs the measure, New Yorkwill begin a four-year phase-out of both the gross receipts tax(GRT) on energy and the natural gas importation tax. “Taxingcompetitive energy markets during its infancy is a major issue thatNew York and other states are facing. We are pleased that New Yorkchose to implement real tax reductions as competitive markets arestarting to emerge,” said NEM President Craig Goodman, a formerdirector of energy tax policy under Presidents Reagan and Bush.”New York is starting to make real progress toward opening itsenergy markets for competition. By cutting existing energy taxes,the governor and legislature are taking the right steps to promoteenergy price competition and to increase the competitiveness of allbusiness in New York.” NEM is a national, non-profit tradeassociation representing a regionally diverse cross-section ofwholesale and retail marketers of natural gas and electricity aswell as other energy-related companies.

The American Gas Association (AGA) has created a new web site tohelp natural gas utilities focus more effectively on majorsupermarkets, restaurants and other national and regional accounts- and to inform those customers about new natural gas technologiesand purchasing options. AGA members can sign on towww.thegaschoice.com to access information provided by nationalcustomer account representatives to AGA staff such as preferencesfor natural gas equipment and appliances. Supermarkets and otherchains “centralize their energy management function at a nationalor regional office. As a result, local natural gas utilities maynot be aware of the customer’s current and future equipment andload management needs,” said Walter Woods, AGA director of businessdevelopment. The website also will have state-by-state updates onopportunities for competition and a monthly newsletter, PIPEline.

Allegheny Energy Solutions formed a strategic alliance withdistributed generation developer Capstone Turbine. “As the world’sleading microturbine manufacturer, Capstone enhances our range ofon-site solutions and provides us with a quality product to offerto our customers,” said David Cole, director of Allegheny EnergySolutions. “We believe there will be significant growth ofdistributed generation opportunities over the next five to 10years, and Allegheny Energy is seizing opportunities in thisgrowing market.” As part of the alliance, a Capstone MicroTurbinewas installed at the site of Allegheny Energy’s Mitchell PowerStation in New Eagle, PA. Allegheny will monitoring the technicaland economical characteristics of the device and identify newapplications. Allegheny Energy, Inc. is a diversified energycompany headquartered in Hagerstown, MD. Allegheny Power deliverselectric energy to about three million people in parts of Maryland,Ohio, Pennsylvania Virginia, and West Virginia.

Allegheny Power’s acquisition of Mountaineer Gas, WestVirginia’s largest natural gas provider and a wholly ownedsubsidiary of Energy Corporation of America, was approved by PublicService Commission of West Virginia (PSC) May 11. The acquisitionadds 200,000 new natural gas customers in a region where it alreadyprovides other energy services. It will grow Allegheny’s serviceterritory to more than 31,000 square miles and its customer base to1.6 million customers. The Federal Trade Commission/Department ofJustice has approved the acquisition. It still requires theapproval of the Securities and Exchange Commission. Closing couldoccur sometime in the third quarter.

The proposed merger of LG&E Energy Corp., the parent ofLouisville Gas & Electric, and PowerGen Plc of the UnitedKingdom moved one step closer to reality yesterday with theapproval of the Kentucky Public Service Commission. “We believe theKentucky commission’s timely decision helps us stay on track forclosing this merger in approximately seven to nine months,” saidLG&E Chairman and CEO Roger Hale. The merger still must beapproved by the Virginia State Corporation Commission, whereLG&E Energy serves several counties under the name Old DominionPower. A decision in Virginia is expected in late July. Also,approvals are required from the shareholders of each company, FERC,the Securities and Exchange Commission and the Federal TradeCommission. The merger will create a global energy company withassets of nearly $12 billion and total revenues of $8.7 billion,serving four million customers worldwide.

The Department of Transportation’s Office of Pipeline Safety(OPS) gave Olympic Pipeline Co. the go-ahead to perform additionaltesting on the section of the product pipeline that was closedfollowing an explosion in Bellingham, WA, that killed three lastJune. The OPS directed Olympic to test the integrity of the 16-inchpipeline segment which runs from Ferndale, WA, to Allen using twotypes of in-line inspection devices, also know as “smart pigs.” Theagency “will not allow this pipeline to reopen until we haveaddressed every known risk to the safety of this pipeline usingstate-of-the-art technology,” said Kelly S. Coyner, of the Researchand Special Programs Administration, which oversees OPS.

El Paso Energy’s Petal Gas Storage said it plans to proceed withthe construction of a third salt cavern at its existing facilitiesin Mississippi based on the success of an open season, which endedMay 5. It noted it received service requests in excess of thecapacity proposed in the open season, and is now in the process ofevaluating the bids. The proposed expansion, if approved by FERC,would add 5 Bcf of working gas storage capacity to Petal’s existingstorage facilities in Hattiesburg, MS, giving the storage company atotal of 15 Bcf of actual working gas capacity and 1.5 Bcf/d ofwithdrawal capacity.

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