Continuation

A U.S. House Commerce Subcommittee set the stage Monday in SanDiego for a continuation of California’s “great electricitydebate,” and the actors all showed up to deliver their linespredictably from the often-conflicting perspectives of consumers,generators, state regulators, energy officials and federalregulators. With two San Diego-based members of the subcommitteeamong the Congressional lawmakers attending, all sides got in theirtwo-cents worth, and are expected to do the same today when theFederal Energy Regulatory Commission holds its hearing on San Diegoelectricity price spikes.

Marking the continuation of a successful 1999 strategy, EnronEnergy Services (EES), a subsidiary of Enron Corp., announcedyesterday it has signed the Chase Manhattan Corp. to a 10-year,$750 million energy management agreement.

The Department of the Interior’s Minerals Management Service(MMS) announced a continuation of the Outer Continental Shelfroyalty-in-kind (RIK) pilot program last week and has doubled theamount of gas previously offered. Nearly 500 MMcf/d of productionwill go on sale this spring, the MMS said. Details for the sale arestill being finalized.

The Department of the Interior’s Mineral Management Service(MMS) announced a continuation of the Outer Continental Shelfportion of its royalty-in-kind (RIK) pilot program Tuesday and hasdoubled the amount of gas previously offered. The nearly 500 MMcf/dof production will go on sale this spring, the MMS said. Detailsfor the sale are still being finalized.

“Storm hype” was billed as the overriding reason for Friday’scontinuation of this week’s price increases that accomplished whathardly anbody thought possible: bring some points back to eitherside of September indexes. The new gains defied the usual weekenddemand slump, growing complacency about finishing storage injectionseason comfortably, a mostly negative screen and cool, autumn-likeweather in many major market areas. In wide-ranging trading,influenced largely by a similarly volatile futures contract, mostcash points ranged from barely up to as much as 15 cents higher.The majority of the gains tended to be on either side of a dime.

A continuation of intense heat in the Eastern U.S. lentfundamental support to gas markets in the region Friday, keepingcash prices flat to slightly higher or lower for the weekend.Again, though, it was a case of “not so” in the San Juan Basin,Rockies and California. Although east-of-California markets sawhigh temperatures approaching or surpassing 100 degrees, a dearthof demand from the Golden State and the unrealized threat of an OFOon El Paso caused gas to back up into the San Juan-Blanco pool,resulting in a steep dive of nearly 30 cents. One source, whopicked up an early Blanco package at $1.78, about a dime down fromThursday, paid only $1.59 near the end of trading.