Commercial

Rapid industrial and commercial gas demand growth around Saskatoon, SK, has prompted provincial gas utility TransGas to launch a $35 million natural gas storage project near the town of Asquith.

Rapid industrial and commercial gas demand growth around Saskatoon, SK, has prompted provincial gas utility TransGas to launch a $35 million natural gas storage project near the town of Asquith.

If you can’t beat them, join them. After watching prices bubble higher last week, commercial and fund traders jumped in on the buy-side Monday to drive the natural gas futures market to new two-month highs.

Looking to help meet North America’s ever-increasing appetite for natural gas, companies such as El Paso Corp. and Shell have been looking outside the box to find new sources of natural gas, and new methods to deliver it to the continent. El Paso announced that it has finalized LNG agreements with a Norwegian consortium, while Shell has proposed its floating liquefied natural gas technology (FLNG) for Timor Sea production. Shell also announced last week that it will invest in the first LNG export project in Venezuela, which intends to tap 10 Tcf of gas reserves and send them to the U.S. East Coast (see related story).

Amid continued non-commercial short covering, natural gas futures worked their way higher Tuesday morning, only to fall late in the session as trade and local accounts took profits ahead of today’s release of fresh storage data. At the closing bell the April contract was 2.1 cents weaker on the day at $2.467.

In reaction to requests from both the commercial and large speculative trading fund communities, Nymex is ready to launch — possibly as soon as Friday — large order execution (LOX) trading for natural gas, which attempts to match buyers and sellers willing to trade lots of between 250 and 5,000 contracts. Similar to the current open-outcry trading for smaller lots, LOX trading will be conducted in the pit and will be supported by a LOX bookkeeper who will announce quotes, match buyers with sellers and facilitate the order execution.

In the midst of injecting 3.5 Bcf of cushion gas, Western Hub Properties indicated Tuesday that its initial commercial start up for California’s second merchant underground storage project will begin in mid-December with about two-thirds of the project’s 12 Bcf working capacity under contract, according to Western Hub’s California project manager, Jim Fossum.

The New Power Co. (TNPC) has launched the Energy Saving Center, a group of online tools to help residential consumers and small commercial businesses reduce energy usage and costs. The company said key elements of the center are the home and business analyzers. These on-line audit tools, which are free, provide a top-to-bottom analysis of energy usage, and offer specific recommendations on behavior modification and products that can save energy, the company said. The products can then be purchased through the Energy Efficient Products Online store. The Home Analyzer allows residential consumers to learn how much money people in homes similar to theirs spend on energy. They can also uncover specific energy-saving opportunities in their own homes. Using the Business Analyzer, small businesses can choose to analyze one facility or multiple sites. TNPC said the tool examines each aspect of a business’ energy use — including which appliances or systems use the most energy — and provides customized analyses, recommendations, and a means to track their progress. The Energy Saving Center can be found on www.newpower.com.

Buoyed by two distinct buying surges, natural gas futures shuffled higher Tuesday as commercial futures traders reacted to rising temperatures across most areas of the country and strong demand in the nearby physical market. While losses Monday were spread out almost equally across the entire natural gas strip, Tuesday’s gains were front-loaded with the August contract receiving a 12.9-cent boost to $3.282. By comparison, the 12-month strip advanced just 9.6 cents to close at $3.715.