Dealt

FERC last week dealt another blow to El Paso Natural Gas,finding that the pipeline had violated the Gas Industry StandardsBoard’s (GISB) standards pertaining to confirmation deadlines andconfirmation quantities.

FERC yesterday dealt another blow to El Paso Natural Gas,finding that the pipeline had violated the Gas Industry StandardsBoard’s (GISB) standards pertaining to confirmation deadlines andconfirmation quantities.

A very divided FERC last week dealt a potentially crippling blowto the controversial Independence Pipeline and associatedSupplyLink and MarketLink expansion projects, requiring them toshow documented proof of binding, long-term contracts for more thantwo-thirds of their project’s firm capacity before they can beginconstruction, as well as to satisfy more than 100 environmentalconditions. The Commission dismissed a major affiliate contract,casting doubt on the market support for the eastward-boundIndependence and SupplyLink projects.

A very divided FERC yesterday dealt a major blow to thecontroversial Independence Pipeline and associated SupplyLinkexpansion projects, requiring each to submit long-term firmcontracts for about 70% of capacity before they can beginconstruction, as well as to satisfy more than 100 environmentalconditions.

Natural gas futures exploded higher yesterday as traders weredealt a royal flush of bullish factors that included much belownormal temperatures on the horizon for much of the country and anew storm brewing in the Caribbean Sea. After opening at $2.98, theNovember contract moved higher, piercing resistance at $3.03 beforerelaxing to finish at $3.007, up 8.7 cents for the session.

Westcoast Energy dealt the 650 MMcf/d TriState Pipeline project a potentially fatal blow last week by exiting the project partnership, which now includes only CMS Energy, and signing on with TriState’s main competitor, the 1 Bcf/d Vector Pipeline. Westcoast dropped its 33% stake in TriState and purchased a 30% equity stake in Vector from project operator Enbridge Inc. It also committed to take 240 MMcf/d of firm capacity in the $500 million Vector project.

FERC last week dealt a partial blow to Dynegy Marketing andTrade’s control over a portion of its contracted-for capacity on ElPaso Natural Gas to California, resulting in a measured victory forthe state’s regulators and San Juan producers. Dynegy enjoyed atriumph of sorts as well, however. The Commission upheld the bulkof its prior decision approving the whopping El Paso-Dynegyarrangement, finding that while it posed some competitive concerns,it was not “unduly discriminatory” in nature.

FERC has dealt a partial blow to Dynegy Marketing and Trade’scontrol over a portion of its contracted-for capacity on El PasoNatural Gas to California, resulting in a measured victory for thestate’s regulators and San Juan producers. Dynegy enjoyed a triumphof sorts as well, however. The Commission upheld the bulk of itsprior decision approving the whopping El Paso-Dynegy arrangement,finding that while it posed some competitive concerns, it was not”unduly discriminatory” in nature.

Ding-dong the downtrend is dead. Well maybe its not dead quiteyet, but it certainly was dealt a potentially fatal blow yesterdaywhen short-covering by funds quickly turned into a buyingfree-for-all as commercials and locals entered the fray. The Augustcontract finished at $2.395, up 14.2 cents for the day. Nearly asimpressive as the price action was estimated volume, whichregistered 113,049 contracts.