Afternoon

Aquila shares plummeted 35% last Thursday to $2.16/share and fell another 3% Friday to $2.09 by mid afternoon after the company suspended its dividend and announced a loss of $332 million, or $1.85 per share, for the 2002 third quarter, compared to diluted earnings of $69 million, or $0.58/share, in the third quarter of 2001.

Florida Gas Transmission ended Wednesday an Overage Alert Day notice that had begun Monday. FGT also informed customers Wednesday afternoon that the excess liquids issue from a pigging operation on Matagorda Offshore Pipeline System had been resolved, and it began accepting full nominations up to the capacity of 230,000 MMBtu/d at the FGT-MOPS interconnect in South Texas for Wednesday’s Intraday 2 cycle.

Extending losses that began last Wednesday afternoon, the December natural gas futures contract sank to new two-month lows Monday, as traders returned from the weekend to learn of bearishly revised weather forecasts. Heavy over-the-counter selling was seen early Monday morning and that translated into a gap lower opening when the regular open-outcry session commenced at 10 a.m. EDT. December never looked back, funneling 19.7 cents lower to close at $3.863.

TXU Corp.’s stock rallied slightly Tuesday afternoon on reassurances from company executives after a precipitous morning fall-off and a mid-day trading halt on New York Stock Exchange.

Kern River reported receiving notification late Thursday afternoon that operational problems at Opal Plant potentially could cause a supply shortage to the pipeline of about 120,000 dekatherms. Upon Kern River’s request, plant operator Williams Field Services agreed to keep Kern River shippers whole for Thursday’s gas day. In a follow-up notice Friday, Kern River said Thursday’s supply shortfall from Opal was 108,000 dekatherms. Kern River asked that WFS deliver an extra 25,000 dekatherms Friday and an extra 15,000 Dth/d Saturday through Monday in order to restore the pipe’s linepack. A Williams spokesman said Monday that Opal Plant had experienced a one-hour power outage Thursday, and also received a batch of gas with excessive moisture content. However, there were no operational issues remaining Monday, he said.

The pattern got broken. For a change cash prices did not follow the previous afternoon’s screen higher, which had been the norm in previous weeks whenever there was a significant change in futures after the morning’s cash deals were complete. Instead, most points were flat to about a dime lower Tuesday.

Once again a previous-afternoon screen uprising worked its magic on next-day cash prices. Friday quotes for weekend flow mostly ranged from approximately flat to nearly a quarter higher. A majority of the gains were relatively modest at around a dime or less.

Transco completed construction work at Station 35 and station capacity was nearly back to normal as of Friday afternoon, a spokeswoman said. The project, which was causing an allocation bottleneck at downstream Station 40, began in May and was originally scheduled to end July 1 but got delayed (see Daily GPI, July 23). There will be additional commissioning outages in coming weeks that will restrict Station 40 capacity temporarily, but most will be only one day long, the spokeswoman said.

Natural gas futures continued to defy gravity Wednesday afternoon as traders refused to sell the market despite the announcement by the American Gas Association (AGA) that only 64 Bcf was pulled from storage last week. That lack of selling pressure combined with the cold temperatures across much of the midwestern and eastern United States gave bulls the confidence they needed to boost the April contract higher on its first day as the prompt contract. April finished at $2.427, up 3.8 cents for the session and just off its high for the day at $2.44. At 71,577 contracts, trading volume was light.