Extent

The extent to which opponents of liquefied natural gas (LNG) receiving terminals in the West will go is being played out in Clatsop County, OR, where three of four elected commissioners who supported the Bradwood Landing LNG project along the Columbia River are fighting recall campaigns. Two Clatsop commissioners already are subject to an Oct. 27 vote to throw them out, and a third commissioner is the subject of a signature-gathering effort to force a third recall ballot.

Although cooling load was due to be fairly light in the northern market areas of the Midwest and Northeast and had diminished to some extent over the weekend in the Midcontinent, it remained strong across the southern third of the U.S. and was growing in some parts of the West. The result, abetted by the previous Friday’s 10.5-cent gain of expiring July futures and the return of industrial load from its usual weekend downturn, was higher prices in most of the cash market Monday.

Most of the market was less than a dime up or down from flat Tuesday as prices recovered to some extent from the previous Friday’s major losses across the board, despite overall heating and cooling load continuing to be light in most areas. Patches of chill here and there, along with predicted Wednesday highs in the mid to high 80s in parts of the South and approaching 100 in the desert Southwest, did contribute a modicum of weather-based demand.

The frigid conditions predicted to be occupying the Midwest, Northeast and to some extent the South Friday finally got the upper hand over prior-day futures weakness and produced gains at most points Thursday. Except for large increases at Northeast citygates, most of the cash market advance was rather timid.

Offshore and onshore oil and natural gas operators continued to assess their energy infrastructure Tuesday to determine the full extent of damages resulting from Hurricane Gustav, but early reports from the Gulf of Mexico (GOM) were “very promising,” said Lars Herbst, regional director for the Minerals Management Service (MMS).

Most of the cash market was able to rally Friday, spurred primarily by the previous day’s 29.4-cent rebound by August futures and to some extent by forecasts of slightly higher heat levels during the weekend in the South, Northeast and Pacific Northwest. The overall move higher defied cooling trends in the Midwest, Rockies and inland California and the loss of industrial load that occurs during a weekend.

Prices continued to rise at nearly all points Wednesday, but retreats of up to about 15 cents at a couple of Rockies points interrupted to some extent the meteoric rise that the regional market has seen since its latest crash last Thursday. The 37.7-cent spike by November futures on Tuesday had a lot to do with the cash strength, but it was supplemented by concerns about whether a low-pressure area in the eastern Gulf of Mexico (GOM) might affect any production and whether a recently identified La Nina event might result in a colder than normal winter.

A surge of power generation demand in the Southeast and in other areas to some extent, prompted by the arrival of more summer-like conditions, along with Friday’s 22.9-cent rally by June futures helped the cash market to realize double-digit price gains across the board Monday. The return of industrial load from its customary weekend hiatus also contributed to market firmness.

Retail rates for Oregon’s three natural gas utilities will increase Nov. 1, but to a lesser extent than previously anticipated, the Oregon Public Utility Commission announced Wednesday. In each case the higher rates reflect higher wholesale commodity charges for gas, the PUC said.