Enterprise Products Partners LP of Houston subsidiary EnterpriseProducts Operating LP and five other energy companies have agreedon the ownership and operating terms of Tri-States NGL PipelineLLC.
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Prices Fall Despite Frigid Weather
Records for low temperatures were being set Tuesday from theMidwest into the Southeast, but it would have been difficult todiscern that from the broad-based retreat in cash prices. Tradersnoted a falling futures screen and factored in a warming trend thatwas expected to begin in the Midwest as early as Tuesday, then sentcash numbers down by a nickel or more at almost every point.
No Expiration Day Heroics for Beleaguered Bulls
Natural gas futures at the New York Mercantile Exchange haveconsistently featured choppy trading, high daily volatility, andprice erosion for the last several months. And expiration dayTuesday was no different as traders tested both sides of a largetrading range before depositing the January contract 2.3 centslower to its final resting place at $1.765. And in doing so, theJanuary contract tumbled over a half dollar during its reign as theprompt month.
Duke Energy Pipes Support Construction of NOPR
The Duke Energy Pipelines have registered their support – with”minor modifications” – for FERC’s proposed changes to itsexisting regulations governing the construction of new pipelinefacilities.
Gas Lines Beset by Ruptures, Explosions
The last couple of weeks have seen a number of mishaps involvingnatural gas lines, one of them resulting in fatalities.
Coral, AlliedSignal Form Distributed Generation Alliance
Since last summer Coral Energy and AlliedSignal Engines havekept a lid on their alliance to market cogeneration solutions toindustrial customers because the generation market has become socompetitive. The two companies finally brought the deal out in theopen last week. It is one of the first alliances between a majorenergy and financial services company and a leading manufacturer ofgas turbine engines for cogeneration units.
Third Remand Affects Penalty Revenue
In another case the Federal Energy Regulatory Commission isgoing to have to defend its policy of not requiring pipelines toflow through penalty revenues, the U.S. Court of Appeals ruledFriday in remanding a case involving NorAm Gas Transmission (No.97-1607). The 2-1 decision in Amoco v. FERC, with Judge Randolphconcurring in part and dissenting in part, did not object toNorAm’s raising penalty rates, but it does ask for an explanationof why the Commission believes penalty revenues will be soinsignificant as to warrant no consideration. In the year prior toNorAm’s rate filing the pipeline had collected $1.8 million inpenalty revenue. The court noted FERC appeared to believe thatbecause penalty rates were raised, the incidence of penalties woulddecrease. But “even if a lesser number of penalties are imposed,the increased penalty rate might result in a gross increase inpenalty revenue. Moreover – and this is the key imponderable -whether a shipper will be willing to incur the penalty depends onhis cost in securing alternative supplies in a tight market.”
Second Remand Affects Penalty Revenue
In another case the FERC is going to have to defend its policyof not requiring pipelines to flow through penalty revenues, theU.S. Court of Appeals ruled Friday in remanding a case involvingNorAm Gas Transmission (No. 97-1607). The 2-1 decision in Amoco v.FERC, with Judge Randolph concurring in part and dissenting inpart, did not object to NorAm’s raising penalty rates, but it doesask for an explanation of why the Commission believes penaltyrevenues will be so insignificant as to warrant no consideration.In the year prior to NorAm’s rate filing the pipeline had collected$1.8 million in penalty revenue. The court noted FERC appeared tobelieve that because penalty rates were raised, the incidence ofpenalties would decrease. But “even if a lesser number of penaltiesare imposed, the increased penalty rate might result in a grossincrease in penalty revenue. Moreover – and this is the keyimponderable – whether a shipper will be willing to incur thepenalty depends on his cost in securing alternative supplies in atight market.”
Sierra Pacific Shareholders Approve Merger
Shareholders of Sierra Pacific Resources and Nevada Power Co.Friday approved a merger of the two companies.
Small Injection Reported, But Storage is Loaded for Winter
The industry will have to wait another week to see the storageimpact from Hurricane Georges, but judging from AGA’s reportyesterday, Hermine, following on Frances and Earl, did her share inpartly holding back the strong tide of injections. AGA reported ameasly 41 Bcf rise for the week ending Sept. 25, which shaved alarge 46 Bcf chunk off the storage surplus compared to last year.