Combination

Intangible drilling costs (IDC) are “an ordinary and necessary business expense of the oil and gas industry,” and should only be modified as part of a broader tax reform package — and in combination with a lower, globally competitive corporate tax rate — according to Industrial Energy Consumers of America (IECA).

The top gas executive for San Francisco-based Pacific Gas and Electric Co. (PG&E) told NGI last week that the combination utility is less than half way toward becoming a “top quartile” gas distribution and transmission pipeline operation and still needs to fulfill almost a dozen federal recommendations made following the September 2010 explosion of a transmission pipeline in San Bruno, CA.

The top gas executive for San Francisco-based Pacific Gas and Electric Co. (PG&E) told NGI Tuesday the combination utility is less than half way toward becoming a “top quartile” gas distribution and transmission pipeline operation but it still needs to fulfill a dozen recommendations from federal regulators following the September 2010 rupture and explosion of the transmission pipeline in San Bruno, CA, he said.

The physical market plunged overall on average by about 14 cents Friday as a combination of a weak screen along with operational problems in places on the East and West Coasts worked to pummel prices lower.

Physical natural gas prices nationwide surged Tuesday as a combination of factors ranging from weather conditions, to high power prices, to attractive price differentials with the screen all brought buyers to their feet. Gains were especially pronounced in the Northeast as traders noted lingering coolness and a strong basis. At the close of futures trading May had gained 3.5 cents to $2.187 and June had added 2.8 cents to $2.318. May crude oil sank $1.22 to $104.01/bbl.

Xcel Energy’s Colorado combination utility recently announced decreases in its second quarter natural gas utility bills, along with a slight decrease for its electric utility bills. Xcel’s utility filed its gas cost adjustment and electric commodity adjustment with the Colorado Public Utilities Commission March 15, calling for gas bill decreases of 13-15% for residential and small business customers, compared to the second quarter last year. The yearly comparisons recognize the seasonal nature of gas use. Electric bills for the same residential and small business customers will decrease slightly less than 1% (0.7%) compared to the first quarter this year and up to 7% less than a year earlier. Residential customers using 40 therms paid 44.5 cent/therm last year in the second quarter ($33.83/month) and will pay 33.03 cents/therm this year in the second quarter ($29.27/month).

Investors apparently approved of Philadelphia-based Atlas Resource Partners LP’s deal to acquire 277 Bcfe of proved reserves, including undeveloped drilling locations, in the Barnett Shale from Carrizo Oil & Gas. Atlas shares closed up 32% Friday following the deal’s announcement.

A combination of fit-for-purpose technology with solid execution in drilling horizontal wells using hydraulic fracturing (fracking) is giving Halliburton Co. confidence that it can deliver on its “frack-of-the-future” strategic initiatives, a company executive said Monday.

The cash- and employee-strapped Colorado state government is battling a growing oil and gas drilling permit backlog created by a combination of a 70% jump in applications between 2007 and 2010 and the recession, which shrank state government. However, oil and gas industry representatives are praising state officials for attempting to address the problem.