Draw

The Energy Information Administration (EIA) reported a “measly” 186 Bcf storage withdrawal for the week ending Jan. 26, stunning many market prognosticators who were looking for a draw closer to, or even greater than, 200 Bcf. The March futures contract immediately plummeted more than 20 cents in reaction to the news to $7.435 as of 10:54 a.m. EST. March ended the day down 13.7 cents at $7.530.

The new Congress wasted little time in taking action on the energy issue that always seems to draw the most headlines: drilling in the Arctic National Wildlife Refuge (ANWR) in Alaska. Rep. Edward Markey (D-MA) was joined by Rep. Jim Ramstad (R-MN) in introducing the Udall-Eisenhower Arctic Wilderness Act, which would designate the coastal plain of the Arctic National Wildlife Refuge as a wilderness area with permanent protections.

An early tally of results from the Mineral Management Service’s Central Gulf Lease Sale 190 looks impressive with 827 bids from 73 companies, which is quite a bit more than the 793 bids from 66 production companies in Central Gulf Lease Sale 185 last year. Lease Sale 190 will be held on Wednesday morning at 10 a.m. in New Orleans.

After shrugging off the undeniably bearish news that 28 Bcf was pulled from storage last week, the natural gas futures market turned dramatically higher Thursday afternoon to notch new 6-week highs. Commercial buyers — sparked by the growing concern that prices in the low- to mid- $5.00s may not be around for much longer — were seen as the featured buyers early in the afternoon. However, when it became apparent that prices were on a tear, the speculators jumped into the buying fray, covering shorts on the way up.

Otter Tail Power Co. on Wednesday said that it will make a play to buy the South Dakota-based utility operations of NorthWestern Corp., which filed for bankruptcy in September 2003 (see Daily GPI, Sept. 17, 2003).

An ally stepped forward north of the border, adding international support to the campaign for financial aid in the United States for the Alaska natural gas project.

An ally stepped forward north of the border, adding international support to the campaign for financial aid in the United States for the Alaska natural gas project.

Utility companies in Nevada and Washington have expressed interest in two Duke Energy power plants that were suspended halfway through construction. Duke put the plants on hold because of depressed market conditions and a power oversupply situation in western markets in the near term.

Gastar Exploration Ltd. is selling its interest in the Culp Draw and Table Mountain areas of the Powder River Basin for $2.4 million in cash from an undisclosed buyer. Gastar, headquartered in Mount Pleasant, MI, owns about 3,033 acres in the leases, and said it would retain a small overriding royalty interest. The sale is expected to close in about 45 days. “Along with the funds from our previously announced Powder River Basin joint venture, this transaction makes additional funds available for our planned activities, including our projects in the Deep Bossier Sands play in East Texas, the deep Trenton-Black River and Devonian Shale plays in West Virginia and our Australian coalbed methane (CBM) plays in New South Wales and Victoria,” said Russell Porter, Gastar’s COO. Gastar’s CBM activities are conducted within Wyoming’s Powder River Basin, and it also owns prospective acreage in East Texas, the Black River play of Appalachia and the East Lost Hills field within the San Joaquin Basin. TransTexas Gas Corp. filed its second Chapter 11 banktruptcy reorganization plan in four years last Friday. The company and its wholly owned subsidiaries, Galveston Bay Processing Corp. and Galveston Bay Pipeline Co., had filed voluntary petitions for relief last November and on May 1 filed their joint plans of reorganization in the U.S. Bankruptcy Court for the Southern District of Texas, Corpus Christi Division. From April 19, 1999 through March 17, 2000, the company also operated as a debtor-in-possession under Chapter 11 and emerged from bankruptcy on Jan. 31 (see Daily GPI, March 20). TransTexas is engaged in the exploration, production and transmission of natural gas and oil, primarily in South Texas, including the Eagle Bay field in Galveston Bay and the Southwest Bonus field in Wharton County.