Attractive

Rising temperatures in many areas and relatively attractive gas prices continued to boost gas demand for power generation Tuesday, prompting additional gains of 10-40 cents in the cash market. An early run-up in futures also helped continue the cash rally but the near-month futures contract ended up losing nearly all of what it had gained by the end of trading Tuesday afternoon.

One of California’s long-time natural gas market analysts sees Rocky Mountain supplies and the expanded Kern River Pipeline as adding to new competitive capacity entering California, although there may be some excess capacity to market on a short-term basis due to delayed construction of new electric generating plants.

California’s long-time natural gas market analyst sees Rocky Mountain supplies and the expanded Kern River Pipeline as adding to new competitive capacity entering California, although there may be some excess capacity to market on a short-term basis due to delayed construction of new electric generating plants.

With the winter gas futures months holding attractive premiums for storage arbitrage, many forecasters are expecting the current 36 Bcf deficit compared to last year’s storage levels to be washed away today with the American Gas Association’s latest weekly report. Market soothsayers are calling for another 100+ Bcf weekly injection, which would make an unprecedented five in a row.

Analysts covering the attempted takeover of Barrett Resources byRoyal Dutch Shell Group said last week they expect to seeadditional consolidation of U.S. independents with a heavy gasportfolio, especially now that the majors and larger independentsare flush with cash from through-the-roof commodity pricing in thepast year.

After being an attractive takeover or merger target, the phonelines to Las Vegas-based Southwest Gas Corp. from prospectivesuitors are idle.

After being an attractive takeover or merger target, the phonelines to Las Vegas-based Southwest Gas Corp. from prospectivesuitors are idle, several major lawsuits having been filed overlast year’s failed merger attempts-first with a desired partner andsecond with an unwanted partner.

Located less than five miles from downtown Los Angeles, theindustrial city of Vernon sits as an attractive trophy for one oftwo proposed natural gas interstate pipelines. The business-focusedlocal government is finishing construction of a new municipal gasdistribution system that will compete with Southern California Gas’existing network. By next year, there will be duplicative gasdistribution systems operating.

Located less than five miles from downtown Los Angeles, theindustrial city of Vernon sits as an attractive trophy for one ofthe two proposed natural gas interstate pipelines. Thebusiness-focused local government is finishing construction of anew municipal gas distribution system that will compete withSouthern California Gas’ existing network. By next year, there willbe duplicative gas distribution systems operating.