Decisions

The Alberta government Thursday granted a one-year extension of two temporary natural gas drilling incentive programs but postponed decisions on introducing any permanent regime changes.

The Fort Worth, TX, city council proceeded with most of a new gas drilling ordinance for the city limits on Dec. 9 but postponed decisions on setbacks for multiple well sites and the definition of a “public building” for its Tuesday (Dec. 16) meeting.

Aware that the company’s share price was treading near single-digit territory and on the hook for some admittedly poor business decisions, Chesapeake Energy Corp. CEO Aubrey McClendon came out swinging last week, telling energy analysts and investors that the company has “plenty of liquidity” and will weather the economic storm by neutralizing capital expenditures (capex) over the next two years. Even with flat spending, the Oklahoma City-based natural gas driller still expects to achieve 5-10% production growth in 2009 and 10-15% gains in 2010.

Avista Utilities increased rates for its gas and electricity customers in Idaho Wednesday, reflecting earlier decisions by the Idaho Public Utilities Commission (PUC). Retail gas utility rates increased by $3.9 million, and electric retail services were boosted $23.2 million. The PUC approved a settlement among the utility, PUC staff and others that increases electric and gas rates an average of 11.98% and 4.7%, respectively. This compares to Avista’s original filing seeking increases of 16.7% and 5.8% for electric and gas retail customers, respectively. Avista serves 72,000 gas and 120,000 electric customers in northern Idaho. “This is the first Avista general rate case since 2004; however, it comes on top of [the utility’s] annual power cost adjustment (PCA) and purchased gas cost adjustment (PGA) rate changes, both of which are adjusted annually Oct. 1,” said the PUC, which noted the PCA and PGA hikes amount to increases of $3.43 and $2.96/month, respectively. “When Avista originally filed its gas cost surcharge last Aug. 18 it requested a 14.2% increase, but declining wholesale gas prices since then and the company’s ability to purchase additional gas for the coming year resulted in the company adjusting its filing on Sept. 15 down to 4%.” The PUC approved new authorized profit levels for the utility — an 8.45% rate of return and a 10.2% return on equity.

FERC Monday upheld its prior decisions not to reallocate costs among El Paso Natural Gas pipeline’s former full-requirement (FR) shippers as part of the conversion of the FR shippers to contract demand (CD) service nearly four years ago.

FERC’s recent decisions on gas quality standards for Florida Gas Transmission (FGT) in a precedent-setting case ( RP04-249) affecting LNG have drawn criticism from both ends and the pipeline itself: from suppliers who claim it will severely limit LNG imports, to power generators who claim the Commission should have provided cost mitigation for end users whose equipment must be changed to handle a different gas quality.

FERC’s recent decisions on gas quality standards for Florida Gas Transmission (FGT) in a precedent-setting case ( RP04-249) affecting LNG have drawn criticism from both ends and the pipeline itself: from suppliers who claim it will severely limit LNG imports, to power generators who claim the Commission should have provided cost mitigation for end users whose equipment must be changed to handle a different gas quality.

Litigation over alleged wilderness areas has become a major obstacle and impediment to oil and natural gas development on federal lands, with key decisions from the District Court of Utah and the Federal Court for the Northern District of California raising doubts about the ability of the energy industry to economically develop natural resources on federal lands, according to a report by the law firm Fulbright & Jaworski LLP.

Litigation over alleged wilderness areas has become a major obstacle and impediment to oil and natural gas development on federal lands, with key decisions from the District Court of Utah and the Federal Court for the Northern District of California raising doubts about the ability of the energy industry to economically develop natural resources on federal lands, according to the latest report on energy trends by the law firm Fulbright & Jaworski LLP.