Despite

Despite a sharp increase in drilling activity recently,financial reports from 21 large producers, representing about 35%of total U.S. gas production, show a decline of 4% from last year’sthird quarter gas production and 3% from the first nine months of1998.

Despite a sharp increase in drilling activity recently,financial reports from 21 large producers, representing about 32%of total U.S. gas production, show a gas production decline of 4%from last year’s third quarter levels and 3% from the first ninemonths of 1998.

Riding a wave of bullish emotion, natural gas futures continuedhigher Friday despite forecasts of warming weather expected thisweek. After checking lower at $3.03, the November contract receiveda steady boost of buying pressure from commercials and speculatorsthat enabled prices to push above $3.10 in the early afternoon. Butjust when it looked as if the prompt month would finish the weeknear its high, a late round of pre-weekend profit-taking droveprices down to settle at $3.072, a net-0.8 cent advance on the day.

Despite failing this summer to deliver several high-profileenergy restructuring corrective laws, California’s statelegislature is expected to be the focal point of future energypolicymaking again next year, with more involvement from thegovernor’s office, according to a variety of energy expertsaddressing a two-day industry workshop in San Francisco.

Despite bullish over the counter dealings and a constructiveopening, the natural gas futures market shuffled lower Monday asshort-term traders sold off newly acquired long positions. TheNovember contract notched a $3.02 high shortly after the open thenproceeded lower to its $2.86 low for the session. A late rallybolstered prices near the closing bell to $2.92, a 5.5-cent loss onthe day.

Despite continued expansion of revenues in energy trading andservices, PG&E Corp. reported last week continued depressedearnings results in those two areas, along with red ink in itsTexas operations. Its traditional Pacific Northwest interstatepipeline, combination utility and merchant power plant businessesall continue to be its money-makers, although down or about thesame compared to similar three-month and nine-month results lastyear.

Despite continued expansion of revenues in energy trading andservices, PG&E Corp. reported continued depressed earningsresults in those two areas in the third quarter, along with red inkin its Texas operations. Its traditional Pacific Northwestinterstate pipeline, combination utility and merchant power plantbusinesses all continue to be its money-makers, although down orabout the same compared to similar three-month and nine-monthresults last year.

Despite recently proposing a massive $15 billion merger ofequals between Commonwealth Edison parent Unicom and Peco Energy,Unicom CEO John W. Rowe still has an appetite for growth. Hebelieves the combined company would need to get bigger in certainareas to remain competitive.

Despite slightly lower wellhead deliverability this yearcompared to last and the growing need for producers to increasedrilling just to maintain production because of steep declinerates, Natural Gas Supply Association President Skip Horvathinsisted yesterday there will be no gas supply “shortfalls” thiswinter. As long as buyers are willing to pay the price, the gaswill be there.