Concerned

Joining the growing list of concerned analysts, UBS Warburg’s Ronald Barone said last week he expects to lower his natural gas price forecasts again this week and cut earnings projections for multiple energy companies in light of lower prices and the downturn in the economy.

Joining the growing list of concerned analysts, UBS Warburg’s Ronald Barone said that with continued lackluster fundamentals and falling prices this week in the natural gas industry, he would not rule out a “similar decline” in spot prices next week as well. In conjunction, Barone said UBS Warburg will take the step that some of its peers have already taken this week and release an updated 2001/2002 composite spot price forecast, along with earnings per share reductions, next week.

The New York State Energy Research and Development Authority (NYSERDA) and the New York Independent System Operator (NYISO) are concerned about a potential overload of the gas transportation system in the state. The two organizations have commissioned a study examining the impact of increased gas demand from 22 proposed new gas or dual fuel power plants, which currently are applying for permits under the state’s siting process. The dual fuel plants also may put a strain on the delivery infrastructure for alternative fuels, the organizations noted.

Business customers of the investor-owned utilities in California are increasingly concerned about the lingering energy crisis that has spiked electricity and natural gas prices and fomented uncertainty about supplies, according to an analysis by the Los Angeles County Economic Development Corp. (LAEDC).

State regulators and consumer advocates expressed deep concernover gas prices yesterday at the winter committee meetings of theNational Association of Regulatory Utility Commissioners inWashington, D.C. But industry officials expressed guarded optimismabout supply and pointed to recent price decreases and drillingefforts as evidence the situation is improving.

Non-affiliate marketers and producers are concerned that KochGateway Pipeline’s proposed new auction process for itsinterruptible storage service (ISS) and its parking and lendingservice (PAL) will discriminate in favor of the pipeline’smarketing affiliate.

As it continues to assuage concerned landowners and perhaps keepa positive image in front of regulators, Houston’s Coastal Corp.yesterday touted the benefits of its proposed Gulfstream NaturalGas System LLC affiliate, saying that the Florida pipeline willpump $1.2 billion into the Sunshine state’s economy, most of thatcoming during the construction phase.

The best laid plans of energy titans can often go astray,particularly where mergers are concerned. ExxonMobil tossed awrench into the BP Amoco-ARCO merger works by suing for apreliminary injunction against the merger partners and PhillipsPetroleum. Phillips has agreed to buy ARCO’s Alaskan holdings forabout $7 billion in a deal intended to win Federal Trade Commissionapproval of the merger (see NGI March 20).

The best laid plans of energy titans can often go astray,particularly where mergers are concerned. ExxonMobil tossed a wrenchinto the BP Amoco-ARCO merger works by suing for a preliminaryinjunction against the merger partners and PhillipsPetroleum. Phillips has agreed to buy ARCO’s Alaskan holdings forabout $7 billion in a deal intended to win Federal Trade Commissionapproval of the merger (see Daily GPI, March17).