From

Coastal Oil & Gas Corp.-on behalf of Coastal Oil & GasUSA LP – acquired properties in the Piceance Basin of Colorado andthe Uinta Basin of Utah from Mitchell Energy & DevelopmentCorp.

Swing gas for today-only flow generally was down a little fromlate-bidweek levels, but not in all cases. In fact, a Sumas traderfound his swing quotes running up to a nickel more than his Julybaseload deals. And even at the points where there were slightretreats, sources still viewed the aftermarket as starting offfairly strong. Despite a stagnant August screen Wednesday, the samething that caused end-of-June and late-bidweek run-ups was creditedfor the swing strength: oppressive heat almost everywhere that hadpower plants straining to handle the air conditioning load.

The results are in from Southern LNG Inc.’s open season for arevitalization of the mothballed Elba Island LNG terminal, and thewinner of all 4 Bcf of capacity is Sonat Energy Services, aSouthern LNG affiliate and an affiliate of Southern Natural Gaspipeline. The winning bid was for a 22-year term at fullcost-of-service rates.

The cash market finally broke free from the doldrums that hadbecalmed much of it earlier this week and found a direction inwhich to move Thursday-mostly down a few cents in the East. Sourcescited the decline in the Henry Hub futures contract for July as themain reason for eastern cash drops that ranged up to a nickel orso. However, continued warm to hot weather kept air conditionershumming in the West, and the resultant power generation load forgas rendered most of the region’s trading points resistant to thegeneral softness. Western quotes tended to be flat to up a penny.

After failing, so far, in its attempt to woo Southwest Gas away from Oneok, Southern Union Co. headed east to announce a friendly $500 million acquisition of distributor Pennsylvania Enterprises Inc. (PEI). With the purchase Southern Union will make its first entry into power marketing.

Nevada Energy Inc. signed an offer to purchase from ConsolidatedBeacon Resources Ltd. two separate onshore exploration agreementscovering a combined total area of about 82,000 net hectaresnorthwest of Truro, Nova Scotia. Nevada will have a 75% workinginterest in 27,970 gross hectares and a 100% working interest in60,936 gross hectares and will be the operator. The agreementsrequire the operator to expend capital to fulfil the earningrequirements under the terms of the work programs as required bythe Nova Scotia Petroleum Directorate. Significant offshore gastests have been documented in the 5 MMcf/d range with establishedoil and gas production of 4 MMBoe realized at the onshore StoneyCreek Field within the same depositional basin about 78 milesnorthwest of the lands.

Sempra Energy International said it began construction on a23-mile, $35 million pipeline running from California to Mexicolast week, adding to the already-extensive activity the company isinvolved in south of the border. The 300 MMcf/d pipeline isscheduled to begin service to the Presidente Juarez power stationat Rosarito, Baja California by December.

About 1 Bcf/d of NOVA capacity will be cut from May 31 to June9 as part of the system is inspected for stress corrosion crackingwhile tie-ins and other maintenance are performed. NOVA will take100 miles of 36-inch line between the Miekle River and Knightcompressor stations in northwest Alberta out of service during thattime. NOVA normally moves a total of about 11.8 Bcf/d, a spokesmansaid.

As sources had expected, the prolonged decline of the Junefutures contract throughout Tuesday’s trading made its influencefelt in softer cash prices Wednesday. But cash losses weredecidedly modest, with nearly all points registering drops of only2-4 cents. Futures offered only a tiny downtick of less than apenny as further guidance Wednesday.