Federal

GRI, formerly the Gas Research Institute, filed itsfourth-to-last annual research, development and demonstrationprogram application last week with FERC, requesting a budget of $70million and approval of its 2001-2005 RD&D Plan.

Since coined by Federal Reserve Chairman Alan Greenspan back in 1995 to explain investors’ love of stocks, “irrational exuberance” has come to typify the stock market and its unprecedented bull rally. But last week as stock prices plummeted again, the phrase was a more apt description of the natural gas futures market, which spiked 14% amid bullish technicals unpinned by concerns over a tightness of supply this summer and next winter.

The Federal Energy Regulatory Commission last week announcedfive “practical steps” that it will take this summer to “alleviatereliability stresses” on the electric transmission grid duringperiods of heightened demand. Commissioner Curt Hebert Jr.,however, cast doubts not only the effectiveness of the measures,but FERC’s motive for proposing them.

Since coined by Federal Reserve Chairman Alan Greenspan back in1995 to explain investors love of stocks, “irrational exuberance,”has come to typify the stock market and its unprecedented bullrally. But yesterday as stock prices plummeted again, “irrationalexuberance” was a more apt description of the natural gas futuresmarket, which spiked sharply amid a frenzy of short-covering andnew long accumulation. When all the dust had settled and the orderstabulated in the data room at Nymex, the numbers were staggering— the June contract rose a whopping 24.1 cents to finish at$2.689, setting a new 30-month high at $3.73 during a session thatsaw 102,978 contracts change hands.

The Federal Energy Regulatory Commission yesterday announcedfive “practical steps” that it will take this summer to “alleviatereliability stresses” on the electric transmission grid duringperiods of heightened demand. Commissioner Curt Hebert Jr.,however, questioned not only the effectiveness of the measures, butalso FERC’s motive for proposing them.

In an attempt to go “above and beyond” federal regulations, sixof Massachusetts’ oldest — and dirtiest — power plants will beretrofitted or rebuilt and will switch to cleaner burning naturalgas after reaching a voluntary agreement last week with stateofficials. The six plants, owned by five companies, vowed to cuttheir emissions in half by 2003, a move that has followed growingpolitical and grassroots pressure throughout Massachusetts.

The proposed merger of Anadarko Petroleum and Union PacificResources moved forward yesterday when the U.S. Federal TradeCommission (FTC) granted early termination of the statutory waitingperiod required under the Hart-Scott-Rodino Anti-Trust ImprovementsAct. Completion of the merger still is subject to the approval ofthe shareholders of both companies and satisfaction of othercustomary conditions. Under the agreement, which was unanimouslyapproved by each company’s board of directors, UPR shareholderswill receive 0.455 Anadarko common shares for each UPR common sharethey own. The offer is worth about $5.6 billion. Anadarko will alsotake on $2.6 billion in long-term debt from UPR. Closing isexpected in July. UPR will become a wholly-owned subsidiary ofHouston-based Anadarko. The purchase more than doubles Anadarko’sNorth American gas reserves from 2.5 Tcf to 5.8 Tcf. The increasemoves the company from the 13th largest company in terms of NorthAmerican gas reserves to fifth. The increase of production is evenmore pronounced, as Anadarko will go from 170 Bcf/year (20th place)by itself to 634 Bcf/year (sixth place).

In an attempt to go “above and beyond” federal regulations, sixof Massachusetts’ oldest — and dirtiest — power plants will beretrofitted or rebuilt and will switch to cleaner burning naturalgas after reaching a voluntary agreement this week with stateofficials. The six plants, owned by five companies, vowed to cuttheir emissions in half by 2003, a move that has followed growingpolitical and grassroots pressure throughout Massachusetts.

The Federal Energy Regulatory Commission last week endorsed acustomer-friendly interconnction plan by Commonwealth Edison,calling it “another critical step” toward getting new merchantpower plants on the transmission grid.