2005

The Senate Energy and Natural Resources Committee has scheduled an Oct. 19 mark-up of a budget reconciliation package for fiscal year 2006 that would authorize exploration and production in the Arctic National Wildlife Refuge (ANWR).

The House Energy and Commerce Committee late Wednesday dropped a proposal that would have given the Federal Energy Regulatory Commission the authority to regulate rates for gathering service in federal waters. Instead, the House panel adopted a watered-down amendment that allows the agency to monitor operators of offshore gas gathering lines, but it stops short of awarding FERC regulatory authority in this area.

Shut-in Gulf of Mexico gas production led to a smaller-than-expected 53 Bcf gas storage injection in the Energy Information Administration’s (EIA) weekly gas storage report for the week ended Sept. 23. The report goosed November natural gas futures higher in the morning, but the contract ended up settling at $14.196, up only 9.6 cents from Wednesday. The injection was well below historical comparisons.

Total restoration costs for the repair and/or replacement of Entergy’s electric and gas facilities damaged by Hurricane Katrina and business continuity costs are estimated to be in the range of $750 million to $1.1 billion, the utility said last Tuesday.

About 1.1 Bcf/d of Texas onshore and offshore production was shut in as of Thursday morning compared with flows on Wednesday, according to the latest report from Denver-based consulting firm Bentek Energy, which pegs total Gulf of Mexico/Gulf Coast production shut ins currently at about 8.3 Bcf/d compared to the amount of gas that was flowing on Aug. 26 prior to Katrina. About 7.8 Bcf/d currently is shut in onshore and offshore Louisiana.

For the third time in less than two weeks, the New York Mercantile Exchange Inc. (NYMEX) announced it was increasing the margins for natural gas, Henry Hub swap, NYMEX miNYsm natural gas, Henry Hub swing swap and Henry Hub penultimate swap futures contracts (see Daily GPI Aug. 17; Aug. 26). The latest changes went into effect at the close of business Monday.

More than 60% of the CEOs of leading U.S. corporations report that Hurricane Katrina will have a negative impact on their businesses, with many expecting the fallout to last up to a year, according to a post-Katrina quarterly survey of 97 CEOs that was conducted by the Business Roundtable.

The extent of the damage from Katrina became a little clearer last week, but predictions on how long the repair process will take and when full production will be restored varied widely. Secretary of Energy Samuel Bodman and Interior Secretary Gail Norton, who toured the damaged area in the Gulf Coast region on Tuesday, warned that natural gas shortages are possible this winter, but analysts interviewed by NGI predicted high prices likely would balance supply and demand.

FERC Chairman Joseph Kelliher last week said that energy attorneys would be well advised to quickly pick up and read a rule FERC moved to adopt this week. The rule requires that issues raised in pleadings and requests for rehearing be set forth in a separate section entitled “Statement of Issues” listing each issue presented in a separate paragraph and referencing representative precedent on which a filer is relying.