Expect

Buoyed by a flow date that several sources expect to be the coldest yet in the East this winter, an approaching return of severe weather in the South, and a strong screen rebound, cash prices recorded across-the-board increases Wednesday.

With the most far-reaching of a number of proposed liquefied natural gas (LNG) projects for North Baja, Mexico, Marathon Oil Co. announced Monday that it expects to start construction this year on its $1.5 billion multi-faceted energy center near the border city of Tijuana. Marathon said its consortium had selected KBR (Kellogg Brown & Root) and Techint S. S. de C. V. as the engineering, procurement and construction contractors.

Dynegy Inc.’s new chairman and interim CEO told employees in a company memo Friday morning to expect more jobs to soon be cut. In Houston, rumors had been circulating for days, after the administrator of the company’s human resources department resigned (see Daily GPI, Sept. 27).

Kinder Morgan Inc. (KMI) and its master limited partnership Kinder Morgan Energy Partners LP (KMP) both expect to beat third-quarter consensus earnings estimates, management said Tuesday.

While many observers, including the Energy Information Administration (EIA), expect natural gas spot prices to continue a downward correction in the near term, consultants at Energy Security Analysis Inc. (ESAI) said they believe the production decline combined with above normal temperatures this summer in key demand regions could spell trouble in the form of a tight marketplace and higher gas prices.

Energy merchants Aquila and Allegheny Energy said last Tuesday that they expect the power market to remain depressed this year, causing significant financial pain going forward, while the gas market is expected to remain strong. The current power supply glut is particularly serious given the high gas prices, they said. Resulting tight spark spreads will mean slim margins for generators and energy merchants this year.

WSI Corp. said it expect warmer-than-normal temperatures for much of the country with the exception the Pacific Coast and in the Southeast over the next three months. The warmest temperatures, relative to normal, are expected in the central Plains and Northeast, while the coolest temperatures, relative to normal, are expected along the California coast.

Expect to see a premium for power prices in Northeast Massachusetts (NEMA) and Southwest Connecticut (SWCT) over the next eight years, a new report issued by Energy Security Analysis Inc. (ESAI) projects. More broadly, ESAI believes that investment in generation will tank over the coming years in the wake of Enron Corp.’s financial collapse and the “credit crunch” that is starting to loom over the industry.

XTO Energy Inc., Denbury Resources Inc. and Marathon Oil Corp. on Friday indicated they expect to keep production levels up this year, although investment in new opportunities may be delayed until commodity prices rise.