Injections

El Paso reported Friday its system integrity was threatened byhigh linepack and it was making maximum injections at theWashington Ranch storage facility. The pipeline said it had imposedcustody limits at delivery points that are not taking scheduledquantities, and if necessary will limit overdeliveries at receiptpoints.

Sonat said it anticipates storage injections will exceed thedaily capacity of its storage fields this week. The weatherforecast is for a continued warming trend through Friday, andinstead of receipt nominations going down they actually went up forthe gas day of Wednesday, the company said. If Southern does notsee a reduction in receipt nominations for Thursday’s gas day it ishighly likely that it will have to implement an OFO.

What do you get when you mix larger-than-expected supply newswith shoulder-month demand and a bearish weather outlook? If youanswered a double-digit price decline then you would have mademoney yesterday in the gas pit at Nymex. In a bearish one-two combothat will not soon be forgotten by bull nor bear, natural gasfutures tumbled lower yesterday afternoon amid an array of negativefundamental factors. Plumbing its lowest level since Aug. 28, theNovember contract slipped 16.1 cents to close at $4.659. Meanwhile,the winter strip suffered a 16.4-cent setback to finish at $4.647.

Union Gas Ltd. has declared an open season for peak storage at its Dawn market hub, with injections beginning Aug. 24, and winter 2000-2001withdrawal on an interruptible basis. Union is offering a storage service option that includes unlimited free cycling and a service option for two-or-three year storage.

Union Gas Ltd. has declared an open season for peak storage atits Dawn market hub, with injections beginning Aug. 24, and winter2000-2001withdrawal on an interruptible basis.Union is offering astorage service option that includes unlimited free cycling and aservice option for two-or-three year storage.

CIG said Friday an OFO begun Nov. 11 (see Daily GPI, Nov. 11) and regarding FT imbalances andand limitations on storage injections would remain in effect throughthe weekend. Based on the latest weather forecasts, CIG anticipatesbeing able to lift the OFO Tuesday. A new bulletin board posting todaywill update the OFO status.

The increase in prices is primarily attributable to increased demand for electric generation and storage injections.

El Paso will will allow neither injections nor withdrawals whenit shuts in the Washington Ranch storage facility April 19-25 formaintenance. Saying the project will severely limit its flexibilityin controlling linepack, El Paso asked in advance for customercooperation in “balancing very closely” scheduled receipts anddeliveries.

In what has become almost routine lately, the AGA’s report ofstrong injections into storage caused a wave of follow-throughselling Thursday. A lower open allowed the contract to slip beneathsupport to settle at $2.02. In doing so, the July contract fell anadditional 8.6 cents to settle at the contract’s lowest point since1997.