Arctic

With an arctic air mass spreading its thermometer level-dropping impact into the Northeast and most of the South, prices were flat to about 80 cents higher at most points Wednesday. However, only the Northeast saw major increases; elsewhere, gains were limited to about a quarter and were mostly in single digits.

Forecasters at Weather Insight LP are predicting seasonably cold winter temperatures in the Midwest and Northeast for the next few weeks and the possibility of another arctic cold snap by mid- to late January.

Forecasters at Weather Insight LP are predicting seasonably cold winter temperatures in the Midwest and Northeast for the next few weeks and the possibility of another arctic cold snap by mid- to late January.

With an arctic air mass poised to deliver what The Weather Channel called “some of the coldest weather the region has experienced in a year or two” into the Northeast Thursday, several citygates there saw huge spikes in Wednesday trading. Transco’s Zone 6-New York City pool saw a top quote of $30 as the point’s average soared by more than $11 to just over $20.

Citing recent forecasts of “a large influx of arctic air over the Pacific Northwest later this week,” Northwest said Monday it is expanding the entitlements implemented last week (see Daily GPI, Jan. 8) to include a Stage II (8%) Overrun Entitlement for Receiving Parties on the Grants Pass and Spokane Laterals starting Wednesday. The Grants Pass entitlement will apply only to points south of the Oregon City Compressor Station. All the entitlements will remain in effect until further notice, Northwest said.

Disregarding the arrival of Arctic air in favor of focusing on the weakness in the cash market and near-record natural gas storage levels, traders on Thursday pushed November natural gas futures 36.8 cents lower to close at $5.782. Action on Thursday marked the contract’s second consecutive 30+ cent loss.

A stand-alone bill to open the coastal plain of the Arctic National Wildlife Refuge (ANWR) to oil and gas drilling passed the U.S. House Thursday on a vote of 225 to 201.

House Resources Committee Chairman Richard W. Pombo (R-CA) reintroduced legislation (H.R. 5429) this week that would open 2,000 acres in the Arctic National Wildlife Refuge (ANWR) to oil and gas drilling. “There is no logical reason to oppose safe energy exploration and production on ANWR’s northern coastal plain,” Pombo said, adding that President Jimmy Carter created the 20 million-acre area in 1980, setting aside 1.5 million acres on the northern coastal plain for the specific purpose of future energy exploration and development. The 2,000 acres requested to be opened to drilling in ANWR’s 1002 area would be a small fraction of that total, yet it could provide 10.4 billion bbl of recoverable oil, which is more than double the proven reserves in the state of Texas, Pombo said. He predicted that peak oil production from the area being set aside could total 1.5 million bbl/d, which is nearly equal to what the U.S. imports from Saudi Arabia every day.

Canada’s arctic gas project has been served with a frosty reminder that it’s struggle with northern natives still isn’t over. The last aboriginal holdouts against the $7 billion (US$6 billion) Mackenzie Gas Project have taken their case to court for the second time in two years.