Emerged

As additional firms emerged Monday on the growing list of companies receiving grand jury subpoenas last week from the U.S. Attorney’s Office in San Francisco for a widening federal probe, staff members of the state senate’s investigative committee looking at alleged manipulation of California energy markets said it will hold a hearing Nov. 18 to examine the role natural gas played in the state’s 2000-2001 power crisis.

Most of the cash market emerged from the Labor Day weekend hiatus to discover prices ranging from flat to a little more than a dime higher Tuesday, but the modest firmness was not expected to last after the energy futures complex took a dive.

The market emerged from a three-day weekend with negative influences still dominant throughout the East and no hint of a rally in sight. Declines tended to range from a nickel to about a dime at eastern points, with those on either side of a dime most prevalent. Larger drops of up to about 20 cents were recorded at unseasonably mild Northeast citygates and downright balmy Florida citygates.

Despite a bullish seasonal weather forecast released by WSI Corp. on Monday, natural gas futures emerged on the downside from their three days in neutral as the November contract slipped 3.6 cents from Friday’s close to notch a $2.208 settle. One trader said November gas futures likely felt sympathy with crude futures, which after rising 69 cents on Friday, experienced a 15-cent decline Monday to finish at $23.28/bbl on the New York Mercantile Exchange.

Divisions emerged last Wednesday at the Federal Energy Regulatory Commission over whether tools used by the Commission in analyzing market power issues are antiquated and in need of an overhaul or are sufficient. Commissioner William Massey believes FERC should initiate a generic inquiry into improving those standards, while Chairman Curt Hebert and Commissioner Linda Breathitt see the regulatory agency’s current approach as more than adequate to meet market power issues.

Divisions emerged yesterday at the Federal Energy Regulatory Commission over whether tools used by the Commission in analyzing market power issues are antiquated and in need of an overhaul or are sufficient. Commissioner William Massey believes FERC should initiate a generic inquiry into improving those standards, while Chairman Curt Hebert and Commissioner Linda Breathitt see the regulatory agency’s current approach as more than adequate to meet market power issues.

A state legislative proposal (SB 278X) emerged late last Friday to start the political process for implementing the governor’s agreement (MOU) with Southern California Edison Co. to return the utility to credit-worthiness in exchange for selling its transmission system to the state and assuring below-market power supplies from the utility’s existing fleet of hydro, nuclear and coal-fired power plants.

Prices emerged from the weekend to resume the slide that dominated much of last week’s market. Only the California border-SoCalGas managed to show a gain for the day as a terribly weak screen, continued lack of fundamental support and expectations of another big storage injection report this week combined to push nearly all points down between 10 and 20 cents Monday.

Prices emerged from the weekend flat to slightly higher or lowerMonday at nearly all points outside the declining California andRockies/San Juan markets. There probably would have been moreeastern softness, sources said, if weather in the Northeast andMidwest hadn’t exhibited more of a tendency to retreat back intowinter, rather than press forward into spring. Even the South wasseeing more chill than normal for this time of year.