After

Northwest Pipeline said it was able to keep all but a smallpercentage of markets whole after its 26-inch mainline explodedabout 8:20 p.m. PST Friday in the Columbia River Gorge area nearStevenson, WA, about 32 miles east of Portland (see Daily GPI,March 1). The rupture caused a fireball, but no injuries werereported and pipeline workers had the situation controlled withinan hour, a spokeswoman said.

After two brief rally efforts failed to produce higher prices,the futures market again came under selling pressure as moreprominent bearish fundamentals more than offset below-normal marketarea temperatures. And in a rare occurrence, the 4.1-cent loss seenin the prompt March contract was outpaced by more substantiallosses in the April, May, June and July contracts.

After being limited to a moribund 2.5-cent range Wednesday, theMarch futures contract snapped back to life yesterday as bulls andbears took turns exerting their influence on the market, which ledto a 7.5-cent trading range. Thursday’s 3-cent setback andsubsequent $1.746 settle would be considered an almost non-eventamid typical winter volatility, but the move was a welcome changeto traders who have grown weary of the slight moves and tighttrading ranges over the past month. Those traders reactedaccordingly, burgeoning estimated volume to 86,227.

After a long, drawn-out regulatory process, Nipsco Industries(NI) finally completed its merger with Massachusetts-based BayState Gas Co., giving the Indiana-based holding company a powerfulEast Coast influence. The $780 million merger originally wasannounced in December 1997 and was expected to close before the endof 1998. Final documents were signed last Friday.

After enumerating eight features any “win-win” upstream dealneeds to have, Exxon Exploration Co. President Jon L. Thompson toldattendees at the Cambridge Energy Research Associates executiveconference in Houston Tuesday that his company will be walking awayfrom “bad deals.

After working out a compromise on a divisive municipalaggregation issue, both houses of New Jersey’s state legislaturepassed identical deregulation bills Thursday, paving the way forelectric unbundling to begin Aug. 1 and gas unbundling to beginDec. 31. The senate passed the bill by a vote of 27-6, and theassembly passed their version by a count of 59-9, with 10abstentions. Gov. Christine Todd Whitman, who sources say helpedbroker the bill, has not said when she will sign the legislationinto law.

Producers may be walking around barefoot and hungry after thefinancial struggle in 1998, but LDCs’ wallets are thin as well. Theexceptionally warm year cut gas distribution throughputsignificantly and several local distribution companies ended theyear in the red. Average net income declined 10% for 19 gas andcombination utilities that reported earnings last week or the weekprior.

Natural gas futures closed higher after a weak start yesterdayas traders were able to look past the dismal fundamental outlook tofocus on the short-covering activity at hand. That lifted the Marchcontract a modest 3.4 cents to finish at $1.86 on its first day asthe prompt month.

After nearly two years of deliberation, the Commodity FuturesTrading Commission conditionally approved a new rule permitting theNew York Mercantile Exchange to hold a three-year pilot duringwhich futures contracts can be exchanged for positions in swaptransactions (EFS transactions). Rule 6.21A is designed to providea closer link between the on-exchange futures market andoff-exchange swaps markets, giving off-exchange participantsgreater ability to manage the risks associated with swap positions.