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Recognizing that they are basically treading on federal turf, California state legislators are trying to determine exactly what, if anything, to do as a result of last week’s energy oversight committee hearings on the issue of the inflated California-Arizona natural gas border prices, according to staff members for the elected officials. An answer may not come until next month when a written report by the oversight committee is completed.

The Federal Energy Regulatory Commission last week basicallytold El Paso Natural Gas to continue full-steam ahead on itsreallocation process at the Topock, AZ, delivery point at theSouthern California border despite pleas by Southern California Gasthat its ratepayers could suffer irreparable harm from the plan.

Its prior ruling basically putting the Kansas ad valorem taxcontroversy to rest was based on two incorrect factual assumptions,the U.S. Court of Appeals for the D.C. Circuit conceded last week.But despite the errors, the court said the thrust of its opinionremains the same — Kansas producers owe refunds to customers whopurchased gas in the early 1980s at prices that, because theyincluded the tax, were above the maximum legal limit.

Very mild softness was the dominant feature of the cash marketTuesday with a few points turning in basically flat showings.Others were off by up to a nickel. Prices started off near theirlow points but were able to rebound a few cents later in thetrading cycle, sources in the Gulf Coast and Rockies/Southwestsaid.

Cash was basically “chasing” the screen Thursday, a marketersaid. Although overall numbers were down by a nickel or more atnearly all points, prices were rebounding in late activity aftertraders saw the Henry Hub futures contract for May overcome anearly dip and head back up.

“Everything basically went back to index,” said a trader onLouisiana pipes Thursday after prices had slipped to either side of$2. Markets were down across the board, even in previously immuneintra-Alberta. Reasons for the softness weren’t hard to find:moderating weather, a huge storage injection report and a plungingfutures screen.