Continent

After building itself a growing customer base, it looks like the U.S. natural gas industry may not be able to service it all if the economy picks up this year. If the gas-directed rig count ramps up to 1000 by the end of the year — averaging about 900 rigs through 2003 — then supply available in the U.S. will only be down about 2 Bcf/d from 2002 levels, EOG Chairman Mark Papa estimates. He believes drilling will pick up, but if active rigs don’t hit that level “then production is going to fall harder.”

After building itself a growing customer base, it looks like the U.S. natural gas industry may not be able to service it all if the economy picks up this year. If the gas-directed rig count ramps up to 1000 by the end of the year — averaging about 900 rigs through 2003 — then supply available in the U.S. will only be down about 2 Bcf/d from 2002 levels, EOG Chairman Mark Papa estimates. He believes drilling will pick up, but if active rigs don’t hit that level “then production is going to fall harder.”

CMS Energy CEO William McCormick said Wednesday his company, which already operates the largest LNG terminal on the continent, plans to build two terminals in Mexico and another offshore in the Gulf of Mexico. As new gas-fired electric generating plants continue to pop up all over the country, gas demand is expected to increase by 3.5% to 4%, or nine-tenths of a Tcf annually, according to McCormick. This demand growth will produce the economics necessary to increase LNG importation into the country.

The northern frontier on the eastern side of the continent isstepping up work on adding new supplies to the North Americannatural-gas market, along with promoters of a development andpipeline revival in Alaska and the Northwest Territories.

The northern frontier on the eastern side of the continent isstepping up work on adding new supplies to the North Americannatural-gas market, along with promoters of a development andpipeline revival in Alaska and the Northwest Territories.

The Mid-Continent Area Power Pool (MAPP) executive committeeapproved the execution of the memorandum of understanding with theMid-America Interconnected Network (MAIN) to merge the reliabilityfunctions of the two organizations. The MAIN Board of Directorsapproved the memorandum on April 7. The goal is to have a jointregional reliability organization (RRO) in place by November. Theorganization will ensure standards compliance through auditing,planning and operating reserve requirements and will establishsanctions procedures to enforce compliance with reliabilitystandards. MAPP is an association of more than 90 electricutilities and other electric industry participants. MAIN is one of10 other regional reliability councils under the North AmericanElectric Reliability Council.

Richmond, VA-based Dominion Energy stretched across the Continent to complete its purchase of gas producer Remington Energy Ltd., of Calgary, AB in a deal valued at nearly US$300 million that will give Dominion a stake in Alliance Pipeline. Still to be completed is its $6.3 billion agreement to buy Consolidated Natural Gas (CNG), which was originally announced in February, just days before the Remington buyout was revealed (See NGI March 1, 1999).

San Francisco-based PG&E Corp. leap-frogged the continent tocomplete the $1.59 billion acquisition of New England ElectricSystem’s generating business, including hydro and gas-fired plantswith 5,100 MW of capacity. The acquisition was made by PG&Esubsidiary U.S. Generating Co.