Fails

The debate about where producers may or may not drill in the United States “seems to be stuck in a time warp of the 1960s” that fails to take into account the energy industry’s ability to drill with precision and with a minimal environmental footprint, ExxonMobil Corp. CEO Rex Tillerson said Tuesday. “It is time the public debate on access in this country moves forward.”

Pending Senate legislation reauthorizing the Commodity Futures Trading Commission (CFTC) comes up short because it fails to give the agency the authority to oversee over-the-counter (OTC) natural gas trades, including forward contracts, swaps and options, an industrial energy consumers group told Senate leaders who crafted the bill.

The energy industry breathed a sigh of relief Thursday morning as the Energy Information Administration reported that 123 Bcf was pulled from underground natural gas storage for the week ended Dec. 17. While higher than most expectations, the draw remained within the industry’s projection range — unlike the erroneous pre-Thanksgiving report that threw the market into chaos.

Ivan was back for an encore performance in the Gulf of Mexico production area as a tropical storm, but spot prices responded more to weak fundamental demand Thursday as they ranged a few cents to either side of flat in the Gulf Coast and Northeast but were flat to down about 15 cents in the Midcontinent/Midwest and West.

Prices exited last week in much the same fashion they had spent the previous four days: falling at nearly all points, with a few scattered flat numbers thrown into the mix. Friday’s softness was anticipated because of generally weak cooling load outside the Southwest, a bearish storage report Thursday and the lack of any viable tropical storm threats to offshore production.

Record earnings for ChevronTexaco Corp. in the second quarter masked a 13% decline in U.S. natural gas production from the same period a year ago, continuing a trend reported by other leading producers in recent days. For Houston-based independent Anadarko Petroleum Corp., earnings also showed strong gains in the quarter, but its U.S. gas production struggled to maintain 2Q2003’s output.

Seeing its first action as the prompt month, the June natural gas futures contract took another shot at the psychologically important $6 level following the Energy Information Administration’s (EIA) report of a 78 Bcf weekly gas storage injection for the week ended April 23.

The most significant futures event during the relatively quiet holiday week was the continuing rise in gas futures on Thursday despite an unexpected 20 Bcf storage injection reported by the Energy Information Administration. After the May futures contract posted less than a one-cent change for both Monday and Tuesday, the contract found upward momentum on Wednesday and Thursday, settling up a little more than 6 cents each day.

A team of 150 attorneys and assistants working on the Enron Corp. case for 18 months failed to find any direct evidence or testimony to indicate that former Chairman Kenneth Lay was aware of wrongdoing at the now-bankrupt company, a court-appointed examiner who led the effort told The Washington Post.