Barring the potential for additional gas demand that couldresult from the Kyoto global-warming accord, the Gas ResearchInstitute (GRI) yesterday projected that domestic natural gasconsumption will rise by about 30%, or 9.5 quadrillion Btus(quads), to nearly 32 quads by 2015. It predicts that producers,both in the United States and Canada, will be able to meet thedemand challenge, but it conceded that the road ahead won’t be aneasy one.
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Administration to Nominate Massey to Another Term
Industry concerns that FERC could lose one of its mostexperienced commissioners when his term expires at the end of thismonth were partially quelled late Tuesday when President Clintonannounced his intent to nominate Commissioner William L. Massey toanother term. His new term, which is subject to Senateconfirmation, would expire June 30, 2003.
Ohio PUC Staff Moves to Complete Unbundling
An additional 1.6 million customers in 41 Ohio counties could bechoosing alternative gas suppliers this winter, followed by morethan 2.8 million customers in 57 of Ohio’s 88 counties in November1999, if the Public Utilities Commission of Ohio (PUCO) accepts itsstaff’s recommendations. Based on good results in pilot programslast winter in metropolitan Toledo (Columbia Gas), Canton andMarietta (East Ohio Gas) and in greater Cincinnati (Cincinnati Gas& Electric), staff told the full commission the three pilotprograms should be expanded as soon as possible.
Restructuring Efforts Riddled with Problems
If legislators and energy regulators aren’t careful, theelectricity industry could end up as a deregulated monopoly ratherthan one that offers customers real choice, representatives of keyelectricity trade groups warned last week.
Heavy Buying Leads to Heavy Futures Gains
Technically, you could call Tuesday’s price action at the NewYork Mercantile Exchange a rally. Not only because the spot Maycontract rose 9.2 cents to $2.561, but also because the marketmoved on strong technical buying. “Funds got back in the market ina big way,” a trader succinctly surmised, referring to an estimatedvolume figure which came in at more than 100,000 contractsyesterday.
Futures Traders End Week With Little Fanfare
The May Nymex contract nudged 0.4 cents lower to $2.475 Friday,amid a day when the contract could neither sustain a move belowtechnical support at $2.44 nor rise any higher than $2.498. Totalestimated volume came in at 46,216, much of which was the work oftraders covering positions before the weekend, a source said.
Nova Scotia Concerned about Maritimes Rate Hike
The Canadian Province of Nova Scotia told FERC it is concernedit could loose royalty revenue and pay higher rates on theMaritimes and Northeast pipeline as a result of Maritimes recentrequest to defer Phase I pipeline construction costs and servicefor one year. Maritimes told FERC last month its only Phase Ishipper, affiliate Duke Energy, exercised a provision in itscontract with the pipeline allowing it to defer using its firmtransportation on the line by a year.
New, Efficient Engine Could Burn Natural Gas
Rolls-Royce has announced a new line of engines that may changethe face of distributed generation. Since 1994 the automotivecompany has been conducting research to design a new generator thatwill help propel the company into the major leagues for distributedgeneration around the world.
FERC Gives Producers a Break on Refunds
Natural gas producers scored a victory Wednesday when FERC ruledthey could post surety bonds in lieu of multi-million dollarrefunds to customers that fast coming due on March 9th. The bondmethod guarantees that customers will receive their refundpayments, and it gives producers what they seek most – a delay inpaying out the amounts until disputes over the refunds calculationsare resolved. The downside of this option is that producers will berequired to continue paying interest on the refund principal aslong as the bond remains in effect. Producers also have thealternative of paying their refund amounts into escrow accounts.
PG&E, California Producers Negotiate Gathering Sale
In a deal that could be the first of its kind in the nation,Pacific Gas and Electric is locked in serious negotiations withnorthern California natural gas producers to sell them itsextensive utility gas gathering system linked to in-state wells,most of which are in the dry gas fields of the greater SacramentoValley. The deal being sought, which is expected to take the betterpart of 1998 to gain final regulatory approvals, is an offshoot ofthe omnibus Gas Accord unbundled intrastate transmission andstorage services that start March 1. The parties will not put adollar value on the facilities involved in the negotiations, but itis conservatively estimated at tens-if not hundreds-of millions ofdollars, involving hundreds of miles of low- and medium-pressurepipelines and related gathering facilities linked to more than 100producers.