Consent

Too little, too late was the apt expression for the futuresmarket yesterday, which continued lower despite what someconsidered to be the most constructive fundamentals yet thiswinter. And so the April contract took a page out of the Marchcontract’s playbook, slipping 3.8 cents to $1.659 amid a tight,6-cent trading range. Estimated volume was high for the usuallyquiet day-after expiration with 65,714 contracts changing hands.

ONEOK Inc. is building up its midstream presence by agreeing toacquire all the Oklahoma midstream gas gathering and processingassets of Koch Midstream Enterprises for $285 million in cash.

Retail unbundling in the California natural gas market is”currently being undermined” by Dynegy Marketing and Trade’swithholding of firm transportation capacity on El Paso Natural Gas,the head of the California Public Utilities Commission (CPUC) saidThursday. As a remedy, CPUC President Richard A. Bilas called onFERC to implement regulations prohibiting the “hoarding” ofpipeline capacity and to investigate allegations of anticompetitiveconduct, which he contends was prevalent in the Dynegy-El Pasocontract arrangement.

Maybe it was the urge to converge that had quotes droppingWednesday for both late-February and March bidweek deals. Theincremental softness remained on the mild side as a few pointsmanaged flat showings and most of the others were down by about anickel or less. Once again the bigger declines of 15 cents or morecame at Northeast citygates as they continued to retreat fromMonday’s cold weather-related price spikes.

Trading at the New York Mercantile Exchange for the month ofFebruary has featured tight but choppy ranges punctuated by smalldecreases when sellers slightly outnumbered the buyers in themarket. And yesterday’s expiration-day session was simply amicrocosm of that as the March contract was the focus of a fierce,and mostly balanced battle, which was ultimately decided by sellerslate in the day. The March contract concluded its reign as promptmonth with a 4.4-cent decline to settle at $1.666.

Dominion Resources Inc. (DRI) made its third move of 1999 andits second in less than a week to position itself as a major gasand power player in the Northeast and Midwest. Following on theheels of Monday’s announcement that DRI will acquire ConsolidatedNatural Gas (CNG), subsidiary Dominion Energy said Wednesday itwill make a $34 million (C$50 million) cash offer for RemingtonEnergy Ltd., a publicly traded gas E&P company headquartered inCalgary, AB.

Taking its initial plunge into the Canadian Midstream market, Duke Energy announced Wednesday its subsidiary, Duke Energy Services Canada Ltd., acquired gas gathering and processing assets from Calgary-based Cometra Energy. Financial terms were not disclosed.

FERC yesterday upheld an administrative law judge’s partialinitial decision denying KN Interstate Gas’ (KNI) request to rollin the costs associated with the construction of its Pony ExpressLine and Kansas City Line.

Fidelity Oil Group of Bismarck, ND, the E&P unit of MDUResources Group Inc., production has grown at an average rate ofmore than 10%/year for the last 10 years while reserves have grownat an average rate of more than 8%/year, net of ongoing production.Gas reserves have increased most significantly, growing to morethan 110 Bcf in January after Fidelity’s acquisition of propertiesin Louisiana, Texas, Oklahoma, and Mississippi. The company targetsboth onshore and offshore properties in many of the major basins.Fidelity operations stretch from Canada through the central U.S.and into the Gulf of Mexico.