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Southern California Gas’ attempt to sell its smallest LosAngeles Basin underground natural gas storage facility has beenabruptly halted by state regulators while an investigation isconducted into how the nation’s largest gas utility has dealt withregulators and surrounding landowners in the Eastern LA suburb ofMontebello, CA, bordering the storage facility. It is now in thehands of the California Public Utilities Commission, which couldassess some large fines if SoCalGas is found to have violated staterules.

Senate Bill 7, legislation requiring electricity marketcompetition in Texas as of Jan. 1, 2002, passed the state SenateFriday, leaving the Governor’s signature as the missing piece ofthe puzzle before the bill becomes law. Governor George W. Bush hasnot said when he will sign the Sen. David Sibley (R-Waco)-sponsoredbill, but has voiced his support.

June bidweek activity heightened considerably Thursday astraders sprinted toward the finish line, either trying to wind upeverything Thursday or leave only a few tail-end deals to completetoday. A marketer who made six Chicago citygate deals in a verytight range on either side of $2.30 said June prices were justbarely higher despite a gain of more than a nickel in the JulyHenry Hub futures contract. He thought the lack of volatility wasdue to many people leaving early for a long weekend. If moretraders were still around and working there would be more input andbreadth to the ranges.

Exxon and Mobil took an eagerly anticipated step towardcompleting their merger yesterday as shareholders for bothcompanies approved the combination. Mobil received 98% shareholderapproval for the deal and Exxon received 99%. The votes were heldat separate hotels in Dallas, TX.

KN Energy signed Nicor Gas of Illinois up for 300 MMcf/d ofcapacity on its Horizon Pipeline and began an open season for theproject.

Daniel L. Larcamp was appointed director of the Office ofMarkets, Tariffs and Rates at the Federal Energy RegulatoryCommission (FERC). The office and position were created as part ofinternal restructuring at the Commission under the FERC Firstprogram.

In a draft order the FERC approved Northwest Pipeline’s mainlineexpansion plans in the Columbia River Gorge area of WashingtonState. The expansion will add 10,870 horsepower of compression atthree existing stations, increasing mainline capacity by 50,000Dth/d between the Stanfield, OR, meter station, where Northwestinterconnects with PG&E Gas Transmission-Northwest, andNorthwest’s interconnect with Sumas International Pipeline (SIPI)near Sumas, WA. (Dockets CP98-554-000 and CP98-554-001)

The Energy Information Administration reported that 47 Bcf ofworking gas in Michigan storage facilities was reclassified as basegas in March, which means working gas levels at the end of thewinter heating season were 3% lower than first reported, or 1,430Bcf compared to 1,477.

After almost 18 months of detailed proceedings and negativelegislative signals, California regulators have pulled backsubstantially from original proposals to unbundle the state’snatural gas industry along the lines of its electric deregulation.