2000

With overloads of turned-back capacity and a bottoming market for long-term pipeline transportation contracts, distributors have finally picked up some pipeline support for a “generic” departure from straight fixed variable (SFV) rates.

Responding to state regulators, California’s two largestelectric utilities in separate filings last week proposed that thestate end the four-year-old rate freeze and permit them to buy moresupplies outside of the state-chartered wholesale spot power marketas a means of bringing down excessively high wholesale prices. Partof the means of bringing stability would include rate increases forthe utilities and price caps for merchant generators and marketersselling electricity in California.

Mountain Energy Corp., the Midwest gas marketer that has beenbesieged by lawsuits and a petition seeking to force it intobankruptcy, has notified its customers in Kansas and Missouri thatit will stop supplying them with natural gas after Oct. 31.

Yesterday was not a good time to walk away from your futurespositions to enjoy the Indian Summer weather. Just one week ago,near-month futures hit a record high at $5.78, but by the close ofregular trading yesterday, the November contract had settled belowthe psychologically important level of $5 for the first time sinceSept. 8.

The Department of Energy’s National Energy Technology Laboratory(NETL) last week issued a draft solicitation seeking natural gasindustry comments on a $10-million, three-year program to developtechnology innovations to strengthen the reliability of the U.S.gas pipeline grid.

Calgary-based Fort Chicago Energy Partners L.P. — which owns a 26% equity in the Alliance Pipeline project — said that its largest unit holder, Gendis Inc., will distribute 8.5 million units to shareholders by Nov. 24. Gendis, based in Winnepeg, will retain 6.2 million units of Fort Chicago following the transaction.

The Department of Energy’s National Energy Technology Laboratory(NETL) last week issued a draft solicitation seeking natural gasindustry comments on a $10-million, three-year program to developtechnology innovations to strengthen the reliability of the U.S.gas pipeline grid.

TransCanada Pipelines continued its asset divestiture program last week with the sale of its 50% interest of the Express System crude oil pipeline to AEC and its 10% interest in the Chilean natural gas distributor Metrogas through a $70 million agreement with the existing Metrogas shareholders.

The rush is on to build new pipeline capacity to serve rapidgas-fired power generation growth in the Southeast and Mid-Atlanticregions. Dominion Transmission last week announced a proposed $400million pipeline to serve primarily new power plants in Virginiaand North Carolina.