Larger

Reliant Energy’s increased focus on the non-regulated side ofthe energy business has apparently made the former pipeline anddistribution assets of subsidiary NorAm Energy no longer attractiveto the company. Reliant said last week it hired an investmentbanking firm to evaluate strategic alternatives for two of its gasdistribution companies and its gas pipeline operations.

Fueled by a larger-than-expected storage withdrawal and promptedby gains in Wednesday night’s Access session, natural gas futuresclimbed higher yesterday as traders lifted prices in a briskafternoon buying surge. The March contract finished up 5.2 cents at$2.592, but the real story was the outer months, which gained 6cents or more on moderate position rolling.

The birth of a New England power plant will spawn more importsof LNG to the United States. Last week it was announced that SitheEnergies Inc. will feed its 1,600 MW Mystic Station in Everett, MA,with LNG imported by nearby Cabot LNG Corp.

Texas stands to play a larger role in meeting the nation’sdemand for natural gas, according to one member of the TexasRailroad Commission. After reviewing a report by the NationalPetroleum Council titled “Meeting the Challenges of the Nation’sGrowing Natural Gas Demand,” TRC Commissioner Tony Garza said hesaw opportunities for the state.

After plunging almost a dime lower in response to alarger-than-expected storage injection Wednesday afternoon, thefutures market shuffled sideways yesterday in ahurricane-abbreviated trading session. Traders were unable to gleanmuch fundamentally positive out of a natural gas market that isfaced with mild temperatures and little or no hurricane activity inthe wake of Floyd. The October contract finished at $2.546, down8.2-cents from Wednesday’s close.

In an effort to build a larger customer base, cut costs and offer a wider variety of commodities and services, Indiana Energy, parent of Indiana Gas, announced plans to merge with Sigcorp, the holding company for Southern Indiana Gas and Electric (Sigeco). The merger of equals will create a new $1.9 billion holding company called Vectren Corp.

Merger week in the energy industry continued yesterday with twomore convergence combinations in New England. The larger of the twoinvolved Energy East, the parent company of Upstate New York’scombination utility New York State Electric & Gas, buying CMPGroup, parent of Maine’s largest electric utility, Central MainePower, for $1.2 billion in cash and debt. The other transaction wasa $679 million purchase, including assumption of $201 million indebt, of Yankee Energy by its former parent company NortheastUtilities.

Western Canadian gas is poised to play a larger role in the U.S.supply picture at a time when gas-directed drilling activity hasfar surpassed oil activity in the region, according to the CanadianEnergy Research Institute (CERI).

Western Canadian gas is poised to play a larger role in the U.S.supply picture at a time when gas-directed drilling activity hasfar surpassed oil activity in the region, according to the CanadianEnergy Research Institute (CERI).