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If acquisition talks between BP Amoco and Atlantic Richfield Co.(Arco) do lead to a deal, BP Amoco also would acquire the 82% ofVastar Resources held by Arco. What could or would happen afterthat is anybody’s guess, said John S. Herold analyst John Parry.

Industrial consumption of natural gas increased 3.3% annually inthe eight years between 1985 and 1992, according to an in-depthanalysis of industrial energy demand by the Gas Research Institute.The increase, which was nearly twice the rate of competing fuels,”was largely due to a 28% increase in gas used for industrialheating and power, including a significant expansion ofcogeneration systems in the paper, chemical and petroleumindustries,” GRI said. The report, “The Implications of the Changesin Industrial Energy Demand 1985-1992 (GRI-99/0030), also analyzesindustrial energy consumption data nationally, regionally and byindustry. “The report looks in detail at changes in product mix,processes and energy use during the eight-year period for the sixmajor energy-intensive industries – food, paper chemical, petroleumrefining, primary metals, and stone, clay and glass, and the twomost rapidly growing, but less energy-intensive industries, rubberand metal durables,” said Marie Lihn, GRI project manager. “Thedata can provide real insight into potential future energyconsumption in each of these key industrial sectors.” To ordercopies of the report, call Kelly Murray at 703-526-7832 (fax 7808)or e-mail at baseline@GRI.org. The report is $125 for GRI members,$175 for non-members, plus shipping and taxes.

A new gas tolling agreement between TransCanada PipeLines andthe Canadian Association of Petroleum Producers (CAPP) soon mayreplace Nova Gas Transmission’s 19-year-old, postage-stamp pricingsystem with a formula based on distance- and the diameter of thepipe used for transportation. A memorandum of understanding (MOU),signed by CAPP and TransCanada, marks the culmination of asettlement process started when the Canadian gas industry signed apeace accord last April, which also assured construction of theAlliance Pipeline and approval of the TransCanada-Nova merger.

With little in the way of fundamental support to speak of, cashprices still managed gains between a nickel and a dime Tuesday atalmost every trading point. “It’s got to be technical,” said autility buyer. The tone was set by the screen opening around $1.80,a dime higher than Monday’s opening, even though the April contracteventually ended the day with a small net loss, he said. Anothersource thought it was a case of cash starting to converge with thescreen.

After months of debate and compromise between regulators,marketers and LDCs, SB 601 was introduced to the Pennsylvanialegislature earlier this week, moving residential and smallcommercial gas customers one step closer to gas supply choice. Thenext step for the bill will come on March 23, when the SenateConsumer Protection committee will hold a hearing on the bill.

Florida Gas Transmission plans a smart pig run April 5-9 betweenStations 2 (Robstown, TX) and 3 (Port Lavaca, TX). The project willlimit capacity at these interconnects upstream of Station 3:Duke-Robstown (40 MMcf/d), Valero Nueces (35 MMcf/d) and MOPS (75MMcf/d).

Nipsco Industries reached the brink of gaining a valuable eastcoast influence Thursday as the SEC approved a merger betweenNipsco and Massachusetts-based Bay State Gas Co. The $780 millionmerger was originally announced in December of 1997. Both sides arereviewing final documentation and no other regulatory matters arepending. Nipsco expects the deal to close today.

Summer power price spikes may have hardly triggered a blip onthe gas spot market last year, but that may not be the case in thenear future. With the expected tremendous growth in gas-fired powergeneration, gas prices are on track to be more closely linked withthe price of electricity than the price of oil, according toCoastal Corp. CEO David A. Arledge.

FERC last week gave the green light to the merger between NewYork-based Consolidated Edison Inc. and neighboring Orange andRockland Utilities (O&ampR), moving them a step closer to becomingone of the most formidable electric and gas utility competitors inthe east. The deal, which has been valued at $790 million, isexpected to be completed by mid-year – assuming the regulatoryapprovals of other federal and state agencies are forthcoming.