Against

Merger partners Sempra Energy and KN Energy contend that QuestarPipeline, which claims their marriage would subvert gas andelectric competition in southern California, is seeing monsterswhere none exist. Nevertheless, they agreed to make certainconcessions to Questar to remove a potential threat to their mergertransaction.

Merger partners Sempra Energy and KN Energy contend that QuestarPipeline, which claims the marriage would subvert gas and electriccompetition in southern California, is seeing monsters where noneexist. Nevertheless, they agreed to make certain concessions toQuestar to remove a potential threat to their merger transaction.

Southern Union gained permission last week to join an existinglawsuit against Southwest Gas in a last-ditch attempt to overtakeOneok as the winner in the race to merge with Southwest. Thelawsuit accuses Southwest Gas’ board of directors of refusing tonegotiate with Southern Union in good faith. Despite the SouthernUnion lawsuit filing, Southwest reaffirmed its acceptance of theOneok offer.

Southern Union gained permission Tuesday to join an existinglawsuit against Southwest Gas in a last-ditch attempt to overtakeOneok as the winner in the race to merge with Southwest. Thelawsuit accuses Southwest Gas’ board of directors of refusing tonegotiate with Southern Union in good faith. None of the partiesinvolved would comment further on the situation as of press time.

Maritimes &Northeast Pipeline sponsors defended their proposed pipeline certificate (Phase II) amendment last week against attack by some the project’s own shippers and others who say it is too large and too costly for the market it will serve. Project sponsors said the calls for a stay on the project and a hearing on its size are based on a misreading of its amendment filing and a misunderstanding of its agreements with its shippers (see NGI, Feb. 22 issue).

Nicor Gas has filed a performance-based rate proposal with theIllinois Commerce Commission that would allow the company and itscustomers to save money if Nicor’s commodity, transportation andstorage costs are lower than a fluctuating benchmark. The benchmarkwill be based on a bushel of published gas price indexes, plusaverage transportation costs over the prior year and actual storagecosts. The PBR is expected to be in place starting next January.

Placing another brick in the apparent Chinese wall against Wisconsin pipeline challengers, ANR Pipeline Co. (ANR) executed agreements with the state’s Madison Gas and Electric Co. (MGE) to extend gas transportation and storage services that were to expire over the next four years. The agreements are subject to approval by the Public Service Commission of Wisconsin.

A systemwide entitlement against overtakes that began Dec. 19 onNorthwest remained in effect going into the holiday weekend.Northwest said Wednesday it would continue to operate under a Stage1 entitlement at 3% because it had not seen sufficient improvementin system conditions. However, as of Wednesday the entitlement waslifted on points south of Kemmerer (WY) Station.

Unocal Corp., like most other producers struggling againstdepressed oil and gas prices, said Wednesday it expects to cutcapital spending by 30 to 40% in 1999 from this year’s level. Inaddition, the company is targeting cash expense reductions of $150million, of which about $100 million has already been identified.